The Tata group's four information technology companies will be merged into Tata Consultancy Services after TCS' initial public offering, S Ramadorai, chief executive officer of TCS, told Business Standard.

The outcome of the merger will be a giant IT company with between 28,000 and 30,000 employees, Ramadorai said.

Apart from the unlisted TCS, the Tata group has four IT companies, Tata Infotech, Tata Elxsi, Tata Technologies and CMC.

Merging them into TCS eventually will create an IT powerhouse with a total sales of over Rs 5,483 crore (Rs 54.83 billion) and net profit of Rs 1,339 crore (Rs 13.39 billion), going by March 2002 figures.

In contrast, Wipro reported a turnover of Rs 3,416 crore (Rs 34.16 billion) and a net profit of Rs 866 crore (Rs 8.66 billion) in 2002.

The figures for Infosys Technologies were Rs 2,604 crore (Rs 26.04 billion) and Rs 808 crore (Rs 8.08 billion), respectively.

"Very clearly, the idea is to integrate all of them and then make a very strong pitch both internationally as well as in the domestic scene," Ramadorai said.

Asked what the advantage of merging the IT companies was, Ramadorai replied: "Scale is a differentiator. Stability is associated with scale."

But the TCS CEO clarified that a number of issues had first to be resolved.

"Before the execution of any strategy like that, a lot of legal and other issues have to be addressed because of the way the companies are structured," he said.

He pointed out that TCS was an unlisted company while the others were not. Then, he said, the concurrence of the other companies had to be obtained.

Also, the government had a stake in CMC.

On CMC, Ramadorai said that a lot of integration with TCS was already taking place at the operational level and both companies were bidding jointly for projects.

He said TCS was already leveraging some of Tata Technologies' automotive domain expertise. The group's IT companies have, in fact, been collaborating to a much greater extent in the last two years.