Indian IT company Tech Mahindra has signed an agreement to acquire 100 percent stake in US-based Zen3 Infosolutions for USD 64 million in an all-cash deal.
Headquartered in Seattle, Zen 3 has over 1,300 employees spread across offices in Seattle, Dublin, Hyderabad, Vishakhapatnam, and Bengaluru.
“The acquisition of Zen3 Infosolutions is in line with our strategy to build new capabilities. It has expertise in artificial intelligence, machine learning, annotations, cloud engineering etc which are high growth area,” Vivek Agrawal- Global Head, Enterprise Business and Portfolio Companies, Tech Mahindra said.
Tech Mahindra will acquire 100 per cent stake in the company for USD 64 million or about Rs 460 crore out of which USD 42 million or about Rs 300 crore will be paid at closing and the remaining is linked to the financial performance of the Microsoft customer account for the upcoming three years, Agrawal said.
Zen3 revenue for six month period ended June 30, 2019, was USD 25 million (about Rs 180 crore).
Tech Mahindra expects the deal to close by April 1, 2020
Agrawal said that Zen3 capabilities can be leveraged by Tech Mahindra in developing various voice-based applications, autonomous car projects etc.
In a separate filing, Tech Mahindra announced a dividend of Rs 10 per equity share for 2019-20.
“It has been a quarter of strong growth with substantial operational and financial metrics improvement. This quarter also witnessed healthy cash flow generation, and with a view to returning enhanced value to our shareholders, we are announcing an interim dividend of Rs 10/- per equity share i.e. 200 per cent,” CP Gurnani, Managing Director and Chief Executive Officer, Tech Mahindra said.