L&T Infotech, Mindtree to become fifth largest IT service provider with $ 3.5 Billion conglomerate
2022-05-07![L&T Infotech, Mindtree to become fifth largest IT service provider with $ 3.5 Billion conglomerate L&T Infotech, Mindtree to become fifth largest IT service provider with $ 3.5 Billion conglomerate](https://varindia.com/storage/news/uploads/2018/02/62760754856f1.jpg)
The Boards of Directors of LTI and Mindtree at their respective meetings held today approved a composite scheme of amalgamation of both these independently listed IT services companies under the Larsen & Toubro Group.
The combined entity "LTIMindtree" is expected to provide diverse strategic options and flexibility arising from cost efficiencies and synergies. Mindtree chief Debashis Chatterjee will head the combined entity of "LTIMindtree", officials announced Friday as L&T Infotech CEO and MD Sanjay Jalona resigned for personal reasons.
AM Naik, Chairman, L&T Group, speaking on the merger, said, "This merger represents our continued commitment to grow the IT services business in line with our strategic vision. The highly complementary businesses of LTI and Mindtree will make this integration a ‘win-win’ proposition for our customers, investors, shareholders, and employees.”
The L&T Group Chairman also said, "There may be some overlap in the businesses between Mindtree and L&T Infotech but together they will be strong."He also added, "There is no cultural issue between L&T Infotech and Mindtree. They strengthen each other."
The proposed integration will see L&T Infotech and Mindtree join strengths to create an efficient and scaled-up IT services provider exceeding $3.5 billion and this merger will help us emerge as a partner of choice for large-scale tech transformations and create a distinctive employee value proposition," S N Subrahmanyan, vice-chairman of Mindtree, said in a statement.
Both companies will operate individually till the merger happens. Once the integration is done, the team will decide the focus areas. Sanjay Jalona has cited personal reasons to step down. He has done a lot for the company and we are proud of him," added Subrahmanyan.
After the merger, the aggregate revenue of the combined entity will be around $3.5 billion. LTI has a market capitalisation of Rs 1.03 lakh crore, whereas Mindtree has a market capitalisation of Rs 65,285 crore.
By market capitalisation, the combined entity will surpass Tech Mahindra to become the fifth-largest IT services provider. The firm will employ over 80,000 people, including 4,000 sales and support personnel. Currently, TCS ranks first among IT firms with the highest market valuation, followed by Infosys, HCL Tech, Wipro.
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