The Mahindras are going to allow Mahindra Satyam and Tech Mahindra Satyam to retain their respective business identities after they merge.
The merger is expected to happen some time this year after the Andhra Pradesh High Court gives its go-ahead.
While Mahindra Satyam specialises in information technology services, Tech Mahindra is predominantly a telecom services player. The former offers manufacturing, BFSI (Banking, financial services and insurance), technology, media, retail and healthcare, while the latter provides cloud services, enterprise mobility and security solutions.
“Both the companies have strong brand equity in their respective area across the globe. They have built reputation for service delivery over a period of time. We are not going to dilute it or lose it by abandoning their business identities,” a top executive of the group told
$2.5-b entity
The merger, which will come into effect from April 2011, will create a $2.5-billion entity, making it the fifth largest IT firm in the country after TCS, Infosys, Wipro and HCL.
The combined entity would house 80,000 employees, including from the acquisitions that were made recently. The group had conducted an internal survey to pick a name for the combined entity.
The telecom vertical is projected to contribute 47 per cent of the merged entity, followed by manufacturing 17 per cent and BFSI with 11 per cent.
“We will have a broad corporate entity at the top, with the two verticals IT and telecom) working under it. We have started working as one entity already,” the official said.
Ever since the Mahindras announced the merger plan, the two companies have started working together by doing away with redundancies and going to the market jointly.
Court reserves orders
Meanwhile, the Andhra Pradesh High Court has reserved its orders on the merger plea filed by Mahindra Satyam. This is the last permission the company needs to go ahead with the merger.
Simultaneously, the court heard a couple of other petitions that challenged the swap ratio and wanted the company to repay the alleged advances given during the Raju regime.
The court is likely to come out with the final order after the vacation next month.