BT may sell 31% stake in Tech Mahindra to TCS Market Capital Of M&M Arm Is Close To $2.5 Billion New Delhi: Looking to exit from the Indian venture Tech Mahindra, British Telecom (BT) is understood to have offered its 31% stake to Tata group company TCS. BT may be mulling to exit totally from the venture, sources close to the development said but no confirmation could be obtained either from the British entity or the Indian corporate house. Asked if British Telecom had approached with its offer to sell its total or part stake, a TCS spokesperson said, "We do not comment on market speculation". Sources said that the approach could have been driven out of synergistic angle as TCS has a thriving telecom practice and most importantly BT is a valued customer of TCS. It is also not clear at this stage whether BT has kept Mahindra and Mahindra, the single largest stake holder with 44% share in Tech Mahindra, in the loop about its latest move. Although, the valuation of the company has not yet been done by any professional investment banker, the market cap of the company is close to $2.5 billion as per the current share price of firm. At the close of trading on Friday, Tech Mahindra quoted at Rs 759.75, down 2.42% on the BSE. Asked if the company has talked to TCS examine its suggestion of buying out the 31% stake, BT spokesperson stated, "BT does not comment on rumours and speculation. BT has operations and investments worldwide which we regularly review. India remains a critical market both for BT and our customers, and we expect to continue developing both the operational network and service that we have established over a number of years". Tech Mahindra, which has 65% of its revenue coming from BT, recently got a $700 million contract from the UK company. According to an analyst, BT's exit may prompt other telecom rivals to look at business opportunities with Tech Mahindra. Tech Mahindra spokesperson said, "We do not comment on rumors and speculation. As a strategic partner of BT, we have enjoyed a great relationship with BT over many years and will continue delivering on long term contracts and winning new business." The company reported a revenue of $934.7 million during FY'08, a 44% year-on-year growth. It employs about 24,000 workers. PTI
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