Tech Mahindra says it will pay $70 million (about ₹490 crore) to acquire 65% stake in US-based strategic design consultancy firm Mad*Pow
Mad*Pow's revenue for the current year is at $17.5 million (about ₹122 crore) and the margin is in the mid-teens
New Delhi: IT company Tech Mahindra will pay $70 million (about ₹490 crore) to acquire 65% stake in US-based strategic design consultancy firm Mad*Pow.
"We are buying 65 per cent upfront and for that 65 per cent we are paying about USD 70 million and the balance 35 per cent will be acquired subsequently from the management team and the founders...," Vivek Agarwal, head for corporate development & BFSI at Tech Mahindra Limited, said in a call with analysts.
The company announced plans to acquire Mad*Pow on 30 July .
Tech Mahindra MD and CEO CP Gurnani said Mad*Pow is a 70-people strong organisation with capability in customer experience, human center design and understanding of behavioral science which will give Tech Mahindra a significant edge in digital transformation projects.
Agarwal said Mad*Pow's revenue for the current year is at $17.5 million (about ₹122 crore) and the margin is in the mid-teens.
"The way we have looked at this acquisition is significant part of synergy opportunity across healthcare, financial services and the media industry...," he said.
Mad*Pow acquisition is expected to help Tech Mahindra boost its capabilities in customer experience and digital transformation, user experience design, behaviour change design, content strategy, mobile app and web development, data science and analytics, among others.