Software services major Tech Mahindra on Tuesday announced the acquisition of Hutchison Global Services (HGS) for an upfront payment of $87.1 million (about Rs 484.03 crore).
"Tech Mahindra announces the acquisition of 100 per cent stake in Hutchison Global Services for $87.1 million, payable upfront," Tech Mahindra said in a statement.
The acquisition will provide significant enhancement of Tech Mahindra's expertise in the customer management space and will be a key component of strategic plans going forward, it added.
The deal will also enable Tech Mahindra to leverage the acquired capabilities and scale for expanding the scope of their existing services to other parts of the Hutchison group and to other customers and verticals, the statement said.
HGS, which provides customer lifecycle operations to clients in UK, Ireland and Australia, has over 11,500 employees. It operates out of Mumbai and Pune and is among the largest captives in the telecom domain.
"This acquisition is in line with our growth plans and is a logical next step in extending our relationship with Hutchison. We are committed to this opportunity and excited about the possibilities this acquisition opens up," Tech Mahindra executive vice-chairman Vineet Nayyar said.
As part of the deal, clients of HGS have committed to procure services worth $845 million over a five-year period, and have agreed to HGS being their exclusive provider of certain agreed services in India.
"Hutchison's focused service portfolio combined with our domain knowledge, geographic spread and execution excellence will help us become the undisputed leaders in this space, and extend these services to other verticals and markets," Tech Mahindra managing director CP Gurnani said.
Kotak Investment Banking acted as the exclusive financial advisor for Tech Mahindra, while Hutchison was advised by Goldman Sachs.
Ernst & Young and AZB Partners acted as tax and legal advisors, respectively for Tech Mahindra, while Khaitan & Co, acted as the legal advisors for Hutchison.