The telecom firm announced that following the agreement with Mahindra & Mahindra (M&M), it had completed the sale of a 5.5% shareholding, or 6.9 million shares, in Tech Mahindra to M&M for a total amount of Rs 45.10 crore (63 million) at Rs 653.60 per share. Following this sale, BT has a 24.4% shareholding in Tech Mahindra. The shares of Tech Mahindra were up 4% at Rs 673 on the Bombay Stock Exchange on Tuesday. M&M currently holds about 48% stake in Tech Mahindra and will be acquiring an additional stake from BT that currently holds 24% stake, sources said.
Sources added M&M is keen on acquiring a controlling stake in TechM before the latters expected merger with Mahindra Satyam next year. I suspect M&M wants to increase its share to 51% in the company (TechM) and have a controlling stake, said a top official. M&M's controlling stake in Tech M is expected to boost Tech Mahindra's valuation before it finally goes for a share swap with Mahindra Satyam because it would have a single large owner. Today, Tech M trades at a discount to leading companies due to lack of a single large holding in the company, an analyst that tracks both the firms said.
When contacted, an M&M spokesperson declined to comment.M&M would want to have minimum interference while taking decisions on the entity and therefore, having a board control would make sense, an official observed.
The company has also appointed a number of brand advisers for valuing the two brands Tech M and Mahindra Satyam, before they finally decide on the brand name of the merged entity.