Tech Mahindra reverses downturn; wins $350 million deal from BT

Mumbai: Amidst all the gloomy talk of reduced outsourcing in the face of a general economic downturn, news of Pune-based Indian IT major Tech Mahindra winning a $350 million deal from BT must surely sound as music to the ears for the Indian outsourcing industry.

Of course, it does increase Tech Mahindra's increasing dependence on a single client after the $1 billion deal signed with the telecom major earlier, but any deal in this morose economic climate is sure to bring cheers all around.

Formerly known as Mahindra British Telecom (MBT), Tech Mahindra Ltd. is a joint venture between Mahindra & Mahindra Limited (M&M) and British Telecommunications plc (BT), UK. Head quartered in Pune, the company has offices throughout the world, and is presently the sixth-largest software exporter in India, specialising in the telecom domain.

What's noteworthy, according to Clive Selley, managing director, BT Worldwide Business, is that the work involved is quite different as compared to the previous agreement. Although both the deals are spread over a period of five years, the new deal focuses on ''application support and maintenance'' supporting retail, wholesale and global services businesses, while the previous agreement, that in Selley's words, was about assisting BT ''in delivering major global customer deals and delivering the IT elements of those deals''.

Expectedly, the Tech Mahindra management is rather buoyant about this deal. Sanjay Kalra, president, Tech Mahindra, was quite enthusiastic when he said, ''This deal showcases Tech Mahindra's strengths in delivering business critical services that have so far been hidden under ''business-as-usual'' application support. We are delighted at the confidence BT has shown in us and this contract will further strengthen trust and partnership between our two companies''.

Tech Mahindra is also ramping up its headcount to service this deal, as indicated by Clive Selley, who said that in spite of Tech Mahindra having a ''very large workforce of personnel that are highly skilled in many of the areas covered by this deal'', and he expects ''that they will augment that headcount, in order to meet the new scale that they are undertaking''.

Tech Mahindra has also said that employees in its existing centres in India will service the new deal, with a new office being also set up in the UK for the purpose.

BT Group plc (formerly British Telecommunications plc) is the privatised UK state telecommunications operator. It is the dominant fixed line telecommunications and broadband Internet provider in the United Kingdom. BT operates in more than 170 countries and almost a third of its revenue now comes from its Global Services division, making it one of the largest telecom companies in the world.