Larsen & Toubro Infotech (LTI) and Mindtree said that they have obtained clearances to operate as a single firm from November 14, marking the closure of an over six-month merger process that is creating India’s fifth largest software company.

In a statement, the boards of the two companies said they have got approvals from both the Mumbai and Bengaluru benches of the National Company Law Tribunal (NCLT) to operate as a single entity from November 14. The intent to merge was declared on May 6.

After the scheme becomes effective, shareholders of Mindtree will be issued 73 shares of LTI for every 100 shares they hold in Mindtree.

The Board of LTI and Mindtree have fixed November 24 as the ‘record date’ for determining those Mindtree shareholders who would be allotted new shares. The newly issued shares of LTI will be traded on the NSE and BSE. L&T will hold 68.73% of LTIMindtree after the merger.

L&T group chairman AM Naik said the LTIMindtree merger had “become a reality” in just a little over six months after their respective Boards had approved the amalgamation scheme.

Mindtree, with a market cap of Rs 62,158 crore, will merge into LTI, with a market cap of Rs 90,516 crore, to touch a combined market cap of Rs 152,674 crore.

This is higher than the market cap of the current fifth largest Indian IT services company by revenue, Tech Mahindra. The new organization still trails Tech Mahindra in revenue terms though.

Tech Mahindra had reported a revenue of Rs 20,444 crore in the first two quarters of the ongoing fiscal year, compared to the combined revenue of LTIMindtree which stands at Rs 15,297 crore for the same period. This is the biggest merger in the Indian IT sector since the $2.7 billion Satyam-Tech Mahindra merger in 2013.

Naik said during a press conference on Monday that the firms, including engineering services entity Larsen & Toubro Infotech, will have a combined revenue of $5.2 billion during the current fiscal year and cross $6 billion by next year. The technology entities will include around 26% of the group revenue by 2026, he added.

Debashis Chatterjee, currently chief executive and managing director of Mindtree, will head the combined Mumbai-based entity with over 90,000 employees.

“There are some natural synergies across service lines and even within it there are areas where Mindtree and LTI have been traditionally strong. Across industry focus there is little overlap. The current focus is to create more synergies and create more revenue,” Chatterjee said at the press conference.

Venugopal Lambu and Sudhir Chaturvedi will head markets for the new company. Vinit Teredesai has been appointed the chief financial officer, while Nachiket Deshpande will be the chief operating officer.

Mindtree was founded in 1999 by Ashok Soota, Krishnakumar Natarajan, Rostow Ravanan, Subroto Bagchi, and NS Parthasarathy, among others, and was acquired in a “hostile takeover” bid in 2019, leading to the exit of all its founders.

Soota and Bagchi themselves were senior executives of Wipro, who had quit to start Mindtree. LTI chief executive and MD Sanjay Jalona exited the company soon after the merger was declared. LTI has 700 clients while Mindtree brings 300 clients to the table. A little over 10 customer accounts are common to both companies.

Cross-selling and upselling to key clients will be a top strategy for the new company, said Chatterjee.