Tech Mahindra, a provider of solutions and services to the telecommunications industry, has acquired a 100 percent stake in Hutchison Global Services.
The deal was closed at US$87.1 million, payable upfront and builds on an already successful business relationship between Tech Mahindra and the Hutchison group across several countries.
With this strategic deal, Tech Mahindra has significantly enhanced its expertise in the customer management space and will be able to expand its existing services to other customers and verticals.
Goldman Sachs gave its expert financial advice to Hutchison while Kotak Investment Banking acted as the exclusive financial advisor for Tech Mahindra.
"This acquisition is in line with our growth plans and is a logical next step in extending our relationship with Hutchison. We are committed to this opportunity and excited about the possibilities this acquisition opens up," said Vineet Nayyar, executive vice chairman, Tech Mahindra.
Committed to procure services
The clients of Hutchison Global Services have committed to procure services worth US$845 million over a five-year period.
In addition, Hutchison Global Services will also be the exclusive provider of certain agreed services in India as part of the agreement.
Hutchison Global Services (HGS) provides customer lifecycle operations to clients in U.K., Ireland and Australia. Boasting an associate base of more than 11,500 employees, HGS operates out of Mumbai and Pune.
Capital for this acquisition is said to be raised through internal accruals and borrowings. Tech Mahindra intends to absorb all employees of HGS.
"With this acquisition, we further strengthen our leadership position in the telecom domain. Hutchison's focused service portfolio combined with our domain knowledge, geographic spread and execution excellence will help us become the undisputed leaders in this space, and extend these services to other verticals and markets," said C.P. Gurnani, managing director, Tech Mahindra.
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