Tech Mahindra subsidiary sells stake in Altiostar to Rakuten for $45 million

IT services major Tech Mahindra on Wednesday said its subsidiary has divested over 18.5 million shares in Altiostar Networks for USD 45 million (about Rs 331 crore) to Rakuten USA, Inc. "Tech Mahindra (Americas) Inc - an 100 per cent subsidiary of Tech Mahindra Ltd - divested its holding of 18,518,518 C1 Preferred shares in Altiostar Networks," Tech Mahindra said in a regulatory filing.

Given that it is a minority investment, there is no contribution to turnover/revenue/income and net worth by Altiostar Networks, Inc during last financial year, it added.

"The buyer is Rakuten USA, Inc," the filing said, adding the consideration received from the sale is USD 45 million.

Rakuten Mobile and Tech Mahindra have also signed an agreement, where the Indian tech firm will be a preferred partner and provide technologies as well as software capabilities to support the development and deployment of mobile networks for global customers of RCP (Rakuten Communications Platform).

Through the agreement, Tech Mahindra will also provide managed IT, security and network services to Rakuten Mobile, a statement said.

There are also plans to designate Tech Mahindra as an official reseller of RCP, it added.

"This first of its kind collaboration with Rakuten Mobile not only strengthens our existing partnership with them but will also enable us to drive innovation in the telecom space, provide enhanced customer experience and lead the transformation in mobile network technology from the forefront," Tech Mahindra Managing Director and CEO C P Gurnani said.

Mickey Mikitani, Chairman, President and CEO of Rakuten Inc, said that with a common vision for digital transformation of the telecommunications industry, the company is very excited about the potential of the partnership with Tech Mahindra in bringing more agile, responsive and efficient services to customers around the world.

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