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UPDATE 1-Satyam, Tech Mahindra to consider merger Wednesday
March 20, 2012 / 12:03 PM / 6 years ago

UPDATE 1-Satyam, Tech Mahindra to consider merger Wednesday

* Mahindra seeks to create consolidated IT services provider

* Amalgamation of wholly-owned subsidiaries also on agenda (Adds details, background)

By Harichandan Arakali

BANGALORE, March 20 (Reuters) - The boards of Satyam Computer Services Ltd. and Tech Mahindra Ltd. , IT services providers part of the Mahindra group, will meet on Wednesday to consider a merger, the companies said on Tuesday in separate statements.

Billionaire Anand Mahindra purchased Satyam in a government-sponsored sale in 2009 after the founder of the Hyderabad-based software services provider admitted to one of the largest accounting frauds in India.

Mahindra is seeking to create a consolidated IT services powerhouse by merging Satyam and Tech Mahindra, which provide software services to clients mostly in the United States and Europe.

Satyam, now re-branded Mahindra Satyam, reported a better-than-expected fiscal third-quarter profit on Feb. 1 .

Satyam shares rose 4.7 percent to 74.15 rupees at close of Mumbai trading in a market that gained 0.25 percent. Tech Mahindra shares added 4.9 percent at 648.7 rupees.

The two companies will also consider the amalgamation of some of their wholly-owned subsidiaries - Venturbay Consultants Private Ltd, C&S System Technologies Private Ltd, CanvasM Technologies Ltd and Mahindra Logisoft Business Solutions Ltd - the statements said. (Editing by Malini Menon)

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