ACQUISITION

MAHINDRA SATYAM
Leading global business and information technology services company It is an Indian IT services company based in Hyderabad, India. It was founded in 1987 by B Ramalinga Raju. It is part of the $14.4 billion Mahindra Group, a global federation of companies and one of the top 10 business houses based in India. It has development and delivery centers in the US, Canada, Brazil, the UK, Hungary, Egypt, UAE, India, China, Malaysia, Singapore, and Australia serve numerous clients.

SERVICES OFFERED
Aerospace and Defence Banking, Financial Services & Insurance Energy and Utilities Life Sciences & Healthcare Manufacturing, Chemicals & Automotive Public Services & Education Retail Consumer Packaged Goods Travel, Transport, Logistics Telecom, Infrastructure, Media and Entertainment & Semiconductors

VALUES

Customer First Good Corporate Citizenship

Individual Dignity
Professionalism Quality focus

TECH MAHINDRA LTD.

It is a leading provider of solutions and services to the telecommunications industry It is ranked #6 in India's software services firms and overall #161 in Fortune India 500 list for 2011. It has implemented more than 15 Greenfield Operations globally and has over 128 active customer engagements mostly in the Telecom sector It has principal offices in the UK, United States, Germany, UAE, Egypt, Singapore, India, Thailand, Taiwan, Malaysia, Philippines, Canada and Australia. It is one of the top 10 business houses based in India.

SERVICES
Equipment manufacturers Software vendors Systems integrators worldwide IT investment

VALUES

Customer first Good corporate citizenship

Professionalism
Commitment to quality Dignity of the individual

ACQUISITION

EXECUTIVE SUMMARY

The Board of Directors of Mahindra Satyam and Tech Mahindra have approved the merger of Mahindra Satyam with Tech Mahindra through a Share Swap The swap ratio for the merger is 2 shares of Tech Mahindra (face value of Rs. 10 each), for every 17 Shares of Mahindra Satyam (face value of Rs. 2 each) Creation of a single go-to-market strategy with benefits of scale and enhanced depth and breadth of Capabilities, translating into increased business opportunities and reduced expenses Stronger merged entity financially and in industry positioning Unified management focus and fungible talent pool De-risked business profile Optimized costs and productivity improvement with benefits of scale

KEY DETAILS
Appointed date of 1st April 2011 Merger ratio of 2 shares of Tech Mahindra (face value of Rs. 10 each), for every 17 shares of Mahindra Satyam (face value of Rs. 2 each) is approved by both the boards 204 mn shares of Mahindra Satyam held by Venturbay to be transferred to a trust, to be held as treasury stock. Rest of the shareholding held in Mahindra Satyam to be cancelled Tech Mahindra to issue 10.34 crore shares to Mahindra Satyam shareholders Increase in equity base to Rs 230.8 crore

ADVANTAGES

The combined entity will be able to better leverage Tech Mahindras depth of expertise developed in telecom to better penetrate the opportunity presented by Mahindra Satyams diverse set of clients across multiple verticals. Mahindra Satyams expertise in enterprise solutions will enable a more complete value proposition to be delivered to Tech Mahindras clients and penetration into the larger landscape. The amalgamated entity will have a further balanced share of revenue contribution from three key geographies viz Americas, Europe and Rest of World. Creation of a single go-to-market strategy with benets of scale and enhanced depth and breadth of capabilities, translating into increased business opportunities Stronger merged entity nancially and in industry positioning Unied management focus and fungible talent Pool Optimized costs and productivity improvement with benets of scale Diversication into multiple verticals like BFSI, Manufacturing and Retail Ability to offer a wide range of service offerings like Enterprise Services and Engineering Services to current and future customers

RESULTS
During the 1st few months of the merger, Mahindra Satyam was successful in winning clients and retaining and expanding existing client engagements. Despite winning new clients, the uncertainty regarding the companys financial health and future outlook did determine many companies from inviting Mahindra Satyam to a new sourcing mandate. The expectations that the restatement of financials and better understanding of the companys capabilities will improve Mahindra Satyams participation in RFPs, especially in the areas that are foundation for growth.

ADVANTAGES TO THE COMPANYS SECTORS

Manufacturing: Mahindras group core business across the automotive, aerospace, engineering and defense, and component manufacturing segments strengthen the capabilities and experience of the largest vertical for legacy satyam. Telecommunications: Distinctive expertise of Tech Mahindra working with global telecom service providers and equipment manufactures is being leveraged in other enterprise vertical through digital convergence solutions such as enterprise mobility Enterprise IT services: A legacy strength for satyam enterprise services remain strong especially in the areas of enterprise integration. Vertical-led BPO: Manufacturing, telecom, pharmaceutical, financial services are the key growth engines for this emerging area within Mahindra satyam and will help in providing customers

CONCLUSION

Satyam business in a better position than ever before following Tech Mahindra take-over Mahindra Satyam would have collapsed had it not been acquired by another Indian company in the form of specialist telecoms supplier Tech Mahindra later in 2009. The company is doing well now. Its latest results $329m, which was 14% higher than the same period last year and 10% more than the previous quarter. It made a profit of $69m, which was 49% higher than the same quarter a year ago and 12% higher than the previous quarter. The great advantage of the combination of Satyam and Tech Mahindra is the ability to cross sell and up-sell. The company is now far more profitable because it sells more services into customers.

CONTND

The company is now selling across both sets of customers. This has helped Mahindra Satyam improve its business in the manufacturing sector by offering them more appropriate software services example if a car manufacture wants to automate a process the company can tap internal knowledge to help them create the software.