In-sourcing outsourcing

27 August 2008 By Una Galani Follow @ugalani

The UK telecom operator is reportedly mulling a sale of its 31% stake in Tech Mahindra, a $2.2bn software services joint venture. BT sees India as a future crown jewel, and this venture is growing fast. So why think about selling? Maybe BT thinks it could do the job itself.

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BT Group is reportedly mulling a disposal of its 31% stake in Tech Mahindra, its fastgrowth $2.2bn Indianlisted software joint venture. In the last three years, sales and operating income at Tech Mahindra have tripled.

BT has worked closely with Tech Mahindra since 1986, contracts with the telecom operator account for roughly 65% of the joint venture's $935m revenues last year. Tech Mahindra's other big customers include telecom operators Vodafone and AT&T.

In a statement, BT declined to comment on the rumour but said that India remains a critical market and that it expects to continue developing both the operational network and service presence in the country.

Tech Mahindra, which floated in 2006, is India's sixthlargest software services exporter by sales. The joint venture is 44% controlled by Indian conglomerate Mahindra & Mahindra.

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