Mumbai, May 6: Larsen & Toubro (L&T) on Friday announced the merger of its two software companies- Larsen & Toubro Infotech (LTI) and Mindtree.

The name of the combined entity will be “LTIMindtree”.

The merger will create “an efficient and scaled-up IT services provider” with a valuation of over $3.5 billion, the Larsen and Toubro Infotech (LTI) said in a press release.

“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 proposed integration will see LTI and Mindtree join strengths to create an efficient and scaled-up IT services provider exceeding $3.5 Bn,” read the press release.

Upon the merger coming into effect, all shareholders of Mindtree will be issued shares of LTI at the ratio of 73 shares of LTI for every 100 shares of Mindtree.

The companies believe the combined business will augment industry-leading revenue growth and profitability. Further, the companies expect that their combined balance sheet will provide diverse strategic options and flexibility arising from cost efficiencies and synergies such as optimization of sales, general and administration (SG&A) costs, consolidation of delivery operations (domestic and overseas) and of overseas entities/branches.