‘Mahindra IT’ marriage delayed again

It’s been nearly four years since Indian industrial conglomerate Mahindra & Mahindra effected the arranged marriage between its telecoms-focused IT services arm, Tech Mahindra, and the resuscitated Satyam, yet the consummation date has slipped again. The latest filing at the Bombay Stock Exchange alerts that the Scheme of Arrangement to effect the merger has now been extended until the end of September.

I must admit I was getting nervous this would happen a month ago when I noted a distinct lack of enthusiasm about the merger in Tech Mahindra’s latest results (see Tech Mahindra still seems shy on sibling Satyam). Not long after the deal was originally announced, management forecasted that integration would complete within two years (see here). Sure there have been regulatory hold-ups, but I suspect the underlying cause of the continual postponements is more fundamental. It was simply the wrong deal.