Naik says merger continue commitment to grow IT services
The amalgamation of Mindtree (NSE: MINDTREE) from New Jersey and listed LTI have been approved, creating an efficient and scaled up IT services provider exceeding US$3.5 billion under Indian heavyweight Larsen & Toubro Group.
The Board of Directors, at their respective meetings held on 6 May 2022, approved a composite scheme of amalgamation of both these independently listed IT services. The transaction is subject to shareholder and regulatory approvals.
“This merger represents our continued commitment to grow the IT services business in line with our strategic vision,” said Mindtree Chairman A. M. Naik.
“The highly complementary businesses of Mindtree and LTI will make this integration a ‘win-win’ proposition for our customers, investors, shareholders and employees.”
Mindtree Vice Chairman S. N. Subrahmanyan added, “We are confident that the proposed merger will help us build on the combined strengths of both these organizations to unlock synergies through scale, cross-vertical expertise and talent pool.
“This will help us emerge as a partner of choice for large-scale tech transformations and create a distinctive employee value proposition.”
Both Mindtree and LTI have delivered market-leading financial performance and created value for shareholders. Given that recent industry shifts (e.g., prominence of large deals, preference for end-to-end offerings) are benefitting at-scale players, the two companies have decided that the time is appropriate to combine the strengths of both organizations to better serve the customers.
Significant scale benefits are anticipated through Mindtree and LTI’s complementary strengths resulting in a stronger portfolio of offerings across verticals. Enhanced customer engagement and delivery model through industrialization of delivery and streamlined value-enabling processes is expected to result in improvement in large deal capabilities. These opportunities will create a more distinctive employee value proposition and stronger partnerships with ecosystem players.
Upon the scheme becoming effective, all shareholders of Mindtree will be issued shares of LTI at the ratio of 73 shares of LTI for every 100 shares of Mindtree. The new shares of LTI so issued will be traded on the NSE and BSE. Larsen & Toubro Limited will hold 68.73% of LTI after the merger.
For now, the companies will continue to function independently. A Steering Committee will be constituted to oversee the transition till the merger process is complete.
The name of the combined entity will be “LTIMindtree” leveraging the advantages of both the brands and creating value for all the stakeholders.
Mindtree is a global technology consulting and services company that enables enterprises across industries to drive superior competitive advantage, customer experiences and business outcomes by harnessing digital and cloud technologies. fiinews.com
