Satyam Mahindra to be merged into Tech Mahindra to form US$2.4-billion

India's one of the largest software exporter Mahindra Satyam will soon be merged into its Mahindra's parent software company Tech Mahindra, the parent company sources informed to media after completing the boards meeting.

According to Tech Mahindra, the board of Directors has decided to assimilate Mahindra Satyam into its parent company for making Tech Mahindra country's fifth largest software export company.

The move of merger will help Tech Mahindra in getting large overseas assignments and generate stiff competition in the market, Tech Mahindra added.

After the merger the compound amount of Tech Mahindra would go up to US$2.4-billion and the total number of clients will reach to 350 across 54 countries. The number of work force will cross 75000 marks after the merger.

Giving the detail about the merger process, company informed that post merger, the Mahindra group would have 26.3% stake, while British Telecom would own 12.8%.

10.4% stake will be held as treasury stock while the public shareholders of Mahindra Satyam would have 34.4% and public shareholders of Tech Mahindra would obtain the remaining 16.1%.

The investors will get one Tech Mahindra stock for every 8.5 shares of Satyam, the companies said.

The face value of Tech Mahindra is Rs.10 while it is Rs. 2 for Mahindra Satyam.

The physical merger would take nine months to complete, Tech Mahindra officials inform.