Construction and engineering major Larsen and Toubro (L&T) on May 6 announced the merger of its two software companies, Larsen & Toubro Infotech (LTI) and Mindtree.

“The Boards of Directors of LTI and Mindtree at their respective meetings held today approved a composite scheme of amalgamation of both these independently listed IT services companies under the Larsen & Toubro Group,” the press release stated.

Also Read | Tata Power Q4 Results: Profit rises 31% to Rs 632 crore, revenue surges 15%

The merged entity will be known as “LTIMindtree”.

The transaction regarding the LTI and Mindtree merger is subject to shareholder and regulatory approvals, said LTI. Upon the merger becoming effective, all shareholders on Mindtree will be issued shares of LTI in the ratio of 73 shares of LTI for every 100 shares of Mindtree. “The new shares of LTI so issued will be traded on the NSE and BSE. Larsen & Toubro Limited will hold 68.73% of LTI after the merger,” said L&T Infotech.

Also Read | Zomato’s Deepinder Goyal to donate Rs 700 crore ESOPs to Future Foundation

Both the companies will continue to operate independently. After the merger, the combined value of the combined entity will be around $3.5 billion. LTI has a market capitalisation of Rs 1.03 lakh crore, whereas Mindtree has a market capitalisation of Rs 65,285 crore.

Mindtree CEO Debashis Chatterjee will lead the LTIMindtree, while L&T Infotech Managing Director & CEO Sanjay Jalona resigned citing personal reasons.

Also Read | Reliance Q4 Results: Profit rises 22% to Rs 16,203 crore, revenue grows 36%

Speaking about the merger, AM Naik, Chairman, Mindtree, said, “This merger represents our continued commitment to growing the IT services business in line with our strategic vision. The highly complementary businesses of Mindtree and LTI will make this integration a ‘win-win’ proposition for our customers, investors, shareholders, and employees.”

Also Read | LIC IPO live updates: Largest public issue opens for subscription

JSA (Advocates and Solicitors) acted as legal advisors to Mindtree.

KPMG India Services LLP acted as financial advisor. Ernst & Young Merchant Banking Services LLP were appointed as valuers by Mindtree.