Tech Mahindra in talks to acquire more firms: Anand Mahindra

Says he can't wait for organic growth; refuses to divulge details of target companies

The country's fifth largest software services firm Tech Mahindra is in talks to acquire technology firms, both in India and overseas, to enhance competencies and geographic reach, its Chairman Anand Mahindra said.

Mahindra, who is also the Chairman of the over $16 billion Mahindra Group, said acquisitions have become a part of the "DNA" of the Mumbai-based software services firm.

"Do I see more acquisitions, the answer is yes. It is the way we grow. You cannot move from fifth to where we aspire to be without acquisitions in my opinion and that what I tell our people," Mahindra told PTI.

He further said: "I don't think we can wait only for organic growth. Inorganic has become a part of the DNA thanks to Satyam and other acquisitions, which are much more smaller. Will you see more acquisitions, I hope yes. Are we working on some? Yes. I will, of course, not divulge the details."

In the last two financial years, Tech Mahindra has acquired seven firms, including Satyam Computer Services, Hutchison Global Services and Comviva Technologies.

On the nature of acquisitions, Mahindra said it is for building competencies, geographies and clients.

"You do acquisitions because you want to get new clients, infiltrate a new client or a new geography or most important to build new competencies. Will we see more of them? Yes," he added.

Mahindra said the buyouts could be both in India as well as overseas markets.

"We are open to all. I am open to smaller ones that may take us to newer areas. Sometimes (for) the most innovative cutting edge areas, a small garage start up may have the technology. Some entrepreneurs might want to sell or scale up. We are open to all kinds of acquisitions," he added.

He added that the size could vary from garage start ups that have requisite technology and to larger companies that will build scale.

Tech Mahindra reported 27 per cent jump in consolidated net profit at Rs 686.3 crore for the April-June quarter against a net profit of Rs 540.5 crore in the year-ago period.

Its revenues stood at Rs 4,103.2 crore in the reported period, up 21.7 per cent in the second quarter of this fiscal compared to Rs 3,372.7 crore in the same quarter of 2013-14.

In USD, revenues stood at USD 724 million (up 17.7 per cent year-on-year), while net profit was at USD 121 million (up 22.3 per cent y-o-y).