The long-awaited merger of Mahindra Satyam and its parent company Tech Mahindra Ltd was announced here Wednesday after a joint board meeting of the two companies, an official said.
The merger will result in combined revenues of around $2.4 billion and more than 350 clients across different geographical and industrial sectors.
The move comes after a long and tumultuous journey for Satyam following an accounting scam admitted by its former chairman and founder Ramalinga Raju in January 2009.
The merger will lead to a new management structure to guide the combine.
The merger was proposed after the Anand Mahindra-owned Tech Mahindra bought over the Hyderabad-based Satyam Computer Service Ltd in 2009 in a government auction and renamed it Mahindra Satyam.
Mahindra Satyam shareholders will get one share of Tech Mahindra for 8.5 shares of Satyam, the companies said.
As per the terms decided for amalgamation, 204,000,000 shares of Mahindra Satyam will be transferred to a trust, in which Tech Mahindra will be the beneficiary.
The swap ratio of 2:17 for the merger was inline with market expectations, however the ratio was bit favourable to Tech Mahindra.
The merger had been put on hold in view of ongoing probes into the Satyam fraud by various investigating agencies.