According to media reports, India-based, telco-focused offshore services firm, Tech Mahindra has appointed bankers to manage the merger process with (in effect) subsidiary Mahindra Satyam. Sorting out the financial side of this might prove particularly challenging given that Mahindra Satyam has higher revenues and is curerntly valued about 6% more that its parent on the Mumbai stock exchange.
But this is really a side issue. The question is whether the two companies really belong together. This is something I have never been convinced about. Meanwhile, the Raju scandal that started all of this over 3 years ago rumbles, on to provide an ongoing distraction to both businesses. For now at least, Mahindra Satyam ploughs on (see ‘Healthy progress’ at Mahindra Satyam), while Tech Mahindra struggles (see Tech Mahindra growth stumbles).