This joint unit will be known as LTIMindtree.
The merger of these 2 units was announced on 6 May.
For every 100 Mindtree shares, 73 LTI shares will be given.
New Delhi. L&T Infotech and Mindtree have got approval for merger. It will start functioning as a merged entity from 14 November. According to the market cap, it will become the fifth largest IT provider in the country and the sixth largest firm by revenue. This is one of the biggest merger in the Indian IT sector.
This joint unit will be known as LTIMindtree. It is understood that the combination of both can provide it opportunities to get large scale outsourcing contracts and grow rapidly.
L&T Group Chairman AM Naik said that the merger has been approved by both the Mumbai and Bengaluru benches of the National Company Law Tribunal in two separate orders. Naik said the merger would help L&T achieve its target of expanding IT services to 25 per cent of the group’s total business by 2026. He said, “When it comes to market cap, it can be even higher.”
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The company will move towards becoming great in the next 5 years
Naik said that we can expect big deals in the coming times. LTIMindtree expects to grow from Good to Great and achieve double digit growth rate in the next 5 years. L&T had earlier said that it expects IT services to contribute at least 40 per cent to its market capitalization in the next 2-3 years.
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LTI shares to be exchanged for Mindtree shares
The merger of the two units of L&T Software was announced on May 6 and was expected to be completed by the end of this year. L&T Limited now holds 68.73 percent of LTI. Shareholders of Mindtree will be given LTI shares in the ratio of 73 LTI shares for every 100 Mindtree shares held.
How many employees and who will lead now?
By 30 September 2022, the total number of both the companies was 89,271. Nothing has been said about what will be the effect on this number if both are united. At the same time, a steering committee was formed to oversee the merger proceedings, in which members of the management of both the companies planned and prepared the structure for the combined entity.
Mindtree CEO Debashish Chatterjee will lead this joint entity. Chatterjee’s selection as the CEO of the combined entity was based on his prior experience at Cognizant, where he was responsible for providing IT services across all industry segments.
Tags: business news, IT companies, share market, stock market
FIRST PUBLISHED : November 14, 2022, 17:11 IST