Satyam and Tech Mahindra to merge in $1.8 billion deal
Tech Mahindra Ltd, an Indian software developer backed by BT Group Plc, will buy Satyam Computer Services Ltd in a deal that values the target at $1.8 billion.
Tech Mahindra, which already owns 43 percent of Satyam, will swap two of its shares for every 17 held by the company’s other shareholders, according to a statement today. The deal will merge the once-troubled company into itself in a deal which could wipe out Tech Mahindra's entire debt and create a company with a market value of nearly $3.4 billion.
The combined company, which will be India's sixth-largest software exporter by sales, will have an annual revenue of $2.4 billion. While the merger was long expected, the method and the share swap ratio were the two key points that investors were looking out for.
