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Tech Mahindra to tap capital market
Staff Correspondent
| IPO proceeds will be used to create facilities for expansion |
A STRATEGIC STEP: Vineet Nayyar (right), Vice-Chairman, Managing Director and CEO, Tech Mahindra, and C. P. Gurnani, President, International Operations, at a press conference in Mumbai on Wednesday.
MUMBAI: Tech Mahindra (TM), one of the leading providers of IT solutions to the telecom sector globally, filed its draft red herring prospectus with the Securities and Exchange Board of India (SEBI) on Wednesday for an initial public offering (IPO).
The proposed issue will offer 12.74 million shares to the public, of which 1.15 million shares will be reserved for employees. Mahindra & Mahindra (M&M) and British Telecom (BT), the main promoters of the company, will offer 3.82 million shares and 5.73 million shares, respectively, as part of the issue. The company will issue additional equity of 3.18 million shares as part of the issue.
A statement from Anand Mahindra, Chairman, Tech Mahindra, said, "Tech Mahindra has emerged as one of the leading players in the telecom software space. One of India's top ten software exporting companies, it has now set its sights on new markets and customers and the listing is a strategic step in this direction.''
Addressing the media here on Wednesday, Vineet Nayyar, Vice Chairman, MD and CEO, Tech Mahindra, said the company's employee strength had been growing steadily from 4,900 in 2004-05 to 9,600 in 2005-06 and was now at around 12,000. Similarly, its facilities globally had more than doubled in two years from 10 to 24 and the clientele had gone up from 24 to 62. "While earlier BT accounted for 80 per cent of revenues, that has come down to around 69 per cent now and will gradually decrease. Also, in the last two years, our revenue pattern has shifted to 65:35 for offshore:onsite.''
Tech Mahindra planned to use the proceeds of the issue for creating facilities for expansion.
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