The merger between L&T Infotech and Mindtree has finally been completed on Monday, six months after the deal was announced, following the approval from National Company Law Tribunal (NCLT). With this, the combined entity, LTIMindtree, will become the country's fifth-largest IT provider by market cap and sixth-largest by revenue. “The effective date for the company to start operating as one entity is November 14, 2022”, both the companies said in a joint statement on Monday.

The two Larsen & Toubro (L&T) Group companies had announced their intent to merge in May 2022, which was later approved by their respective shareholders, creditors and other applicable provisions of the Companies Act, 2013. The deal is considered as one of the largest mergers in the Indian IT sector.

“This approval clears the way for the merger of the two independently listed companies as LTIMindtree, a scaledup IT services provider with a client portfolio of more than 750 leading global enterprises from all key industry verticals, and nearly 90,000 professionals spread in more than 30 countries across five continents,” the release said.

As per the agreement, the merger will be a share swap deal at a ratio of 73 shares of LTI for every 100 shares of Mindtree. Parent company L&T will hold 68.73% stake in LTI after the merger. The record date to determine the eligible shareholders of Mindtree for issue of equity shares of LTI pursuant to the scheme is November 24, 2022.

The development comes nearly three years after L&T acquired a controlling stake in Bengaluru-based Mindtree in the country’s first hostile takeover bid in the IT space. In 2019, L&T had initially acquired a 20.4% share in Mindtree from coffee baron late V.G. Siddhartha and affiliate firms, followed by 31% additional stake through an open offer. L&T currently owns 60.95% shares in the mid-sized IT company.  

Commenting on the merger, A. M. Naik, Group Chairman of L&T and Chairman of LTIMindtree, said, “LTIMindtree is integral to L&T’s technology-led growth vision and is poised to play a crucial role in the expansion and diversification of our services portfolio. The highly complementary strengths of LTI and Mindtree make this integration a win-win proposition for all our stakeholders — clients, partners, investors, shareholders, employees, and communities — furthering L&T’s tradition of innovation, excellence, trust, and empathy.”

Speaking on the occasion, Debashis Chatterjee, Chief Executive Officer and Managing Director of LTIMindtree, said, “Amid the proliferation of new business models and revenue streams in a rapidly converging world, LTIMindtree will help businesses proactively take on and shape the future by harnessing the full power of digital technologies. Armed with top talent, comprehensive offerings, and a cumulative experience of more than five decades, LTIMindtree brings the diversity of scale and capabilities required to help businesses reimagine possibilities, deliver impact, and get to the future, faster.”

Ahead of the announcement, Mindtree shares closed 2.8% higher at ₹3,766.35, while Larsen & Toubro Infotech stock price ended up by 2.05% at ₹5,161.20 on the BSE.

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