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Tech Mahindra in talks to buy Bharti arm Comviva Technologies f

  • NEW DELHI: Billionaire Sunil Bharti Mittal-led Bharti Group is in advanced discussions to sell Comviva Technologies, a mobile financial and value-added services (VAS) solution provider, to Tech Mahindra, the Mahindra group's IT arm, for around Rs 750 crore.

    This will be the second sale of a privately-held company by the group in a short span. Last week, the group announced the divestment of training solution firm Centum Learning to Everonn in a cash and share transaction.

    "Tech Mahindra has signed the non-disclosure agreement and has already completed the due diligence of Comviva. They have signed an MoU and have also agreed on the valuation," said a person familiar with the matter. He said the deal had been delayed for a while as some minor issues such as valuation of future contracts of Comviva had to be resolved, but these were expected to be ironed out shortly.

    Formerly known as Bharti Telesoft, Comviva is about 50% owned by Mittal and his family through holding firms and trusts. Private equity firms Sequoia Capital and Cisco hold 30% and 5% stake in the company, respectively, with the balance 15% owned by employees.

    The spokespersons for Tech Mahindra and Bharti said they don't comment on market speculation.

    Tech Mahindra is a part of the $15.4-billion Mahindra Group, which acquired Satyam Computers in an auction by a government-appointed board in 2009 following India's biggest accounting scam. The company posted revenues of Rs 5,500 crore in 2011-12.

    The proposed transaction is in line with the Bharti Group's objective of focusing on core businesses that can make a deeper impact in India and abroad, said the person quoted earlier.

    Comviva posted an operating profit of about Rs 60 crore and revenues of Rs 380 crore for the year ended March 2012.

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