Tech Mahindra Acquires Orchid Cybertech Services; Share Trades Lower

20 Feb 2024 , 10:18 AM

Tech Mahindra, a leading IT services and consulting firm, announced on Tuesday (February 20) that it has acquired 100% stake in Orchid Cybertech Services (OCSI) through its wholly owned subsidiary for $3.27 million.

In a regulatory filing, Tech Mahindra stated, ‘We wish to inform that the company through its wholly owned subsidiary viz., vCustomer Philippines Inc has today i.e. February 20, 2024 at 05:55 am (IST), approved the acquisition of 100% equity shares in Orchid Cybertech Services.’

Orchid Cybertech Services specializes in providing customer experience-related services to TPG Telecom and boasts about 2,950 full-time employees. The company reported a turnover of $37.3 million for the financial year ended on July 31, 2023.

Tech Mahindra highlighted its longstanding relationship with TPG Telecom (TPG) and emphasized that this acquisition further strengthens their ties with TPG. The deal is expected to expand Tech Mahindra’s existing customer experience capabilities and business in the Philippines.

The acquisition of OCSI is seen as a strategic move by Tech Mahindra to facilitate the transition and enable incremental revenue realization. As part of the transaction, OCSI, along with its assets and employees, will be integrated into Tech Mahindra, which will then provide customer support and other services to TPG.

Following the announcement, shares of Tech Mahindra Ltd were trading slightly lower at ₹1,308.20 apiece on Tuesday. However, the stock has seen a 1% increase so far this year and has gained about 15% in the last one year.