IT services firms L&T Infotech and Mindtree received approval for merger from NCLT. Both Mumbai and Bengaluru Benches of the National Company Law Tribunal (NCLT) have approved, via two separate orders, the scheme of amalgamation and arrangement between the two companies.
The two companies had announced their intent to merge in May 2022. The merged entity will be known as LTIMindtree. The merged entity will become the fifth largest IT services company in India in terms of current market capitalization. The Effective Date for the company to start operating as one entity is November 14, 2022.
As part of the merger, all shareholders of Mindtree will be issued shares of LTI in the ratio of 73 shares of LTI for every 100 shares of Mindtree. The parent company, L&T, will hold 68.73 per cent of the merged entity. The Record Date to determine the eligible shareholders of Mindtree for issue of equity shares of LTI pursuant to the scheme is fixed as November 24, 2022.
A M Naik, Group Chairman of L&T and Chairman of LTIMindtree while addressing the media said “This is a milestone for the group and with this the groups IT services businesses will represent 26 per cent of our total business by FY26. In terms of market capitalisation it will be much higher.” He also stated that the merged entity along with L&T Technology Services will generate $5.2 billion in revenue for this fiscal. And the merged entity will touch revenue of $5 billion by next year.
LTIMindtree will be helmed by Debashis Chatterjee as CEO and MD. Some of the other leadership roles that were announced today were Sudhir Chaturvedi, president markets, Nachiket Deshpande as COO, and Vineet Teredesai among others.
The combined entity will have a client base of over 700 and a headcount of 90,000.
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