Hostile takeover bids rare in the IT industry globally, say experts

Such a move by any rival IT firm may lead to value erosion for both entities

During times of speculation that mid-sized IT services company Mindtree may be headed for a hostile takeover by a rival firm, industry experts say such instances are rare in the IT industry globally. 

Besides being a distraction for the management, such hostile action could also result in lingering uncertainty, thus leading to a flight of talent at both the top and mid levels. “Hostile takeovers are not frequent in the IT sector, and as an example, one can think of Oracle’s hostile takeover of PeopleSoft back in 2005-06,” said Hansa Iyengar, senior analyst at London-based Ovum Research.

With V G Siddhartha —