The combined company name will be LTIMindtree Ltd.
The combined company name will be LTIMindtree Ltd.
The Board of Directors of Mindtree Ltd. and L&T Infotech Ltd (LTI) at their respective meetings on Friday approved an association plan to merge the two independent publicly traded IT services companies of the Larsen & Toubro Group.
The combined company name will be LTIMindtree Ltd.
Once the program becomes effective, all Mindtree shareholders will be issued LTI shares at a ratio of 73 LTI shares for every 100 Mindtree shares.
The new LTI shares so issued will be traded on the NSE and BSE. Larsen & Toubro Ltd. will hold 68.73% of LTI after the merger.
Through the proposed integration, Mindtree and LTI will create a $3.5 billion combined IT service provider.
The companies will continue to operate independently for the time being. A steering committee will be formed to oversee the transition until the merger process is complete.
Sanjay Jalona, CEO & MD, LTI has decided to exit the company and the merged entity will be led by Mindtree CEO & MD Dabashis Chatterjee.
The combined company will have a workforce of 80,000 people. The transaction is subject to shareholder and regulatory approvals and is expected to close within one year.
“Given recent changes in the industry (e.g. importance of large deals, preference for end-to-end offerings), large companies benefit from the two companies. Therefore, the two companies have decided it is time to combine the strengths of both organizations to better serve customers,” the companies said in a joint statement.
“The merger is expected to improve large deal capacity. These opportunities will create a more distinctive value proposition for employees and stronger partnerships with ecosystem players,” the statement added.
AM Naik, Chairman of Mindtree, said: “This merger represents our continued commitment to grow the IT services business in line with our strategic vision. The highly complementary businesses of Mindtree and LTI will make this integration a ‘win-win’ proposition for our customers, investors, shareholders and employees.”
SN Subrahmanyan, Vice Chairman of Mindtree, said, “We are confident that the proposed merger will help us build on the combined strengths of these two organizations to unlock synergies through scale, cross-industry expertise and talent pool.”
“This will help us establish ourselves as the partner of choice for large-scale technology transformations and create a distinctive value proposition for employees,” he added.
