Tech Mahindra acquires Born Group; Q2 net profit up 5.6%
Information technology services company Tech Mahindra reported a 5.6 % increase in quarterly profit and announced its acquisition of New York-based digital media agency Born Group at an all-cash deal of $95 million.
Born offers strategy consulting, content creation, digital production, content management system implementations, data-driven user experience and ecommerce, the company said in a statement. Its clients include Tata, Red Bull and Google.
“The acquisition of Born Group will assert our leadership in the rapidly growing electronic and mobile commerce segment globally, and equip us to deliver enhanced user experience to our customers globally,” Vivek Agarwal, head of corporate development and portfolio companies at Tech Mahindra, said, according to a statement.
The Pune-headquartered company said its profit after rose to Rs 1123.9 crore, or Rs 12.78 per share in the second quarter ended September 2019, from Rs 1064.3 crore, or Rs 11.93 per share, a year earlier. Tech Mahindra is a subsidiary of the Mahindra Group.
Revenue in the quarter rose about 5% to Rs 9,069.9 crore, year-over-year.
Digital revenues grew 11.8% sequentially, which made up 39% of the net revenue.
Having delivered steady figures this quarter, the good news at the IT firm is coupled with a strong deal momentum over the next few quarters. Digital continues to be the central theme of the acquisition strategy at Tech Mahindra, Agarwal said.
It is also well-positioned with low exposure to troubled clients, a research report from Kotak Institutional Equities had said on Monday. Tech Mahindra had emerged as one of the top IT stocks this quarter in the same report.