L&T Infotech, Mindtree announce mega-merger; new entity to be called ‘LTIMindtree’

To scale-up their IT services offering and create greater efficiencies, Larsen & Toubro Infotech Limited and MindTree Limited on Friday announced a mega-merger, that will exceed USD 3.5 billion in combined revenue, the companies today informed in their filings  to exchanges. 

"The Boards of Directors of Mindtree and LTI at their respective meetings approved a composite scheme of amalgamation of both these independently listed IT services companies under the Larsen & Toubro Group,” the joint press statement said. 

The new entity post the merger will be called 'LTIMindtree', the statement also read. 

“A Steering Committee will be constituted to oversee the transition till the merger process is complete. The name of the combined entity will be “LTIMindtree” leveraging the advantages of both the brands and creating value for all the stakeholders,” the release said. 

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"Upon the scheme becoming effective, all shareholders of Mindtree will be issued shares of LTI at the ratio of 73 shares of LTI for every 100 shares of Mindtree," as per the statement. 

The new shares of LTI so issued will be traded on the NSE and BSE. Larsen & Toubro Limited will hold 68.73 per cent of LTI after the merger. 

The transaction is subject to shareholder and regulatory approvals. 

LTI Chairman AM Naik commenting on the merger said, "The highly complementary businesses of LTI and Mindtree will make this integration a 'win-win' proposition for our customers, investors, shareholders, and employees". 

Elaborating on the merger, Naik told reporters that Debashis Chatterjee will lead the merged entity. LTI CEO Sanjay Jalona has resigned from the company, citing personal reasons. 

Mindtree Vice-Chairman SN Subrahmanyan said, “We are confident that the proposed merger will help us build on the combined strengths of both these organizations to unlock synergies through scale, cross-vertical expertise, and talent pool.” 

"Given that recent industry shifts (e.g., prominence of large deals, preference for end-to-end offerings) are benefitting at-scale players, the two companies have decided that the time is appropriate to combine the strengths of both organizations to better serve the customers," the statement said.