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Biztech Sep 17, 2012

Tech Mahindra Forays Into Mobility With Mahindra Comviva

By Biztech2.com Staff

Tech Mahindra Limited has announced the acquisition of 51 percent stake on a fully diluted basis in Comviva Technologies Limited, a Bharti Group Company, and a provider of mobile Value Added Services (VAS), mobile money and mobile payment solutions, for a value of Rs. 260 crore. The deal will be subject to regulatory approvals.

The new brand identity will be Mahindra Comviva, reflecting the combined strength and spirit of both the entities.

As part of this arrangement, Tech Mahindra will make an upfront payment of Rs. 125 crore towards the stake acquired and the balance amount of Rs. 135 crore will be paid out over a period of five years based, on Comviva achieving mutually agreed performance targets. The current promoters will continue to hold a 20 percent stake on a fully diluted basis in Comviva, post the deal closure.

Vineet Nayyar, Executive Vice Chairman, Tech Mahindra said, “This acquisition is a significant step forward, in our vision of being a complete and comprehensive partner to our clients and like always, we are confident of making this a successful venture for our stakeholders. In addition to the market leading capabilities, this will also add to our relationship with large operator groups across the world.”

“The world of mobility today encompasses wide range of solutions, where customers be it enterprise or consumers are driving their business and entertainment needs through mobility. This acquisition marks our strong intent and entry into the world of mobility products. We are adding significant capability in areas such as payments and VAS,” added CP Gurnani, Managing Director, Tech Mahindra.

Rakesh Bharti Mittal, Chairman, Comviva said, “Comviva has established itself as a gobal leader in mobile solutions beyond VAS within a short span and has built a solid foundation for the next phase of its growth. We believe that Tech Mahindra, with its deep domain expertise in IT and telecom technologies, is an ideal partner to guide the future growth story of Comviva. We will continue to support Tech Mahindra in their endeavour to take Comviva to the next level and wish them success.”

“The combined entity will bring end-to-end capabilities of products, system integration and services in the mobile VAS, money & payments space. Our enhanced customer experience management offerings will deliver greater value to all our existing customers globally, and provide opportunities for accelerated growth,” added Manoranjan (Mao) Mohapatra, CEO, Comviva.

This acquisition will significantly enhance Tech Mahindra’s capabilities in the mobile VAS domain and will provide access to a marquee client base, enabling significant cross-selling opportunities. It dovetails into two of Tech Mahindra’s stated strategies, namely investing in emerging areas such as Network, Mobility, Analytics, Cloud and Security and further focus on non-linear growth. Comviva’s primary focus and business model is expected to strengthen this aspiration.

Comviva has an extensive portfolio of solutions spanning mobile money and payments, mobile data, integrated messaging, mobile lifestyle and customer life cycle management solutions, which enable mobile service providers to enrich mobile users’ lives, whilst rationalising costs, accelerating revenue growth and enhancing customer lifetime value.

by Biztech2.com Staff

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