Software services provider Tech Mahindra on Monday announced the acquisition of a 51% stake in mobile value added services provider Comviva, in which Bharti Group has a major stake, for Rs. 260 crore.
The acquisition is subject to regulatory approval. The new entity will be called Mahindra Comviva.
The current promoters will continue to hold 20% stake on a fully-diluted basis, it added.
"This acquisition is a significant step forward in our vision of being a comprehensive partner to our clients and we are confident of making this a successful venture for our stakeholders," Tech Mahindra executive vice-chairman Vineet Nayyar said.
Tech Mahindra will make an upfront payment of Rs. 125 crore, while the balance Rs. 135 crore will be paid out over five years based on Gurgaon-based Comviva achieving mutually agreed performance targets.
Tech Mahindra had recently acquired Hutchison Global Services, the call centre arm of Hutch, for $87.1 million (Rs. 484.03 crore).
Private equity investors WestBridge Capital, Sequoia Capital India, Cisco Systems are reportedly selling their entire stake, while Bharti Group is selling a part of its holding. The size of its previous and current holdings were not revealed.