Late night on Thursday 4 May, Tech Mahindra Limited (TechM) announced that it has approved a proposal to increase the stake to 80% by acquiring an additional 29% equity shares in Tech Mahindra Arabia Limited (TechM Arabia).
Tech Mahindra is an Indian multinational information technology services and consulting company that enables digital transformation, consulting and business re-engineering services and solutions.
Tech Mahindra Arabia Limited (TechM Arabia) was incorporated in 2015 and provides digital systems integration and consulting services to the energy and utilities, banking, and telecommunications sectors in the Kingdom of Saudi Arabia (KSA) with more than 75 employees.
Tech Mahindra Limited will pay an aggregate of $11.1 million to Midad Company Limited for the acquisition of 29% stake in Tech Mahindra Arabia Limited and the acquisition will be completed by July 31, 2023, the company said.
Tech Mahindra Limited (TechM) currently holds 51% stake in Tech Mahindra Arabia Limited (TechM Arabia) which will increase to 80% after the acquisition of 29% and Midad Company Limited’s stake in Tech Mahindra Arabia Limited (TechM Arabia) will come down to 20% from 49%.
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Tech Mahindra Arabia Limited is a Saudi Arabia-based joint venture between Tech Mahindra Limited and Midad Company Limited in which Tech Mahindra Limited (TechM) holds 51% stake and Midad Company Limited (Midad) holds 49% stake.
Tech Mahindra Arabia Ltd reported unaudited revenue of Saudi Riyal (SAR) 160.7 million in the fiscal year ending March 31, 2023. The company reported revenue of Saudi Riyal (SAR) 88.8 million in FY22, a YoY growth of 69.14% as against Saudi Riyal (SAR) 52.5 million in FY21.