New Delhi: Continuing with its strategy of global inorganic growth, Indian corporate giant Tatas are reported to be in advanced stages of talks for buying the IT business unit of German telecom giant Deutsche Telekom.
Tata Group is planning this deal through the European unit of Tata Consultancy Services and is currently studying the books of Deutsche Telekom's T-Systems unit, German business weekly Focus Online reported on Thursday.
T-Systems is one of the smallest units of Deutsche Telekom. It had reported a revenue of Euro 12.5 billion (about Rs 73,000 crore) last year and has a total workforce of over 55,000 people.
When contacted, a TCS spokesperson in Mumbai told PTI the report was completely speculative and the company did not comment on speculations.
Officials from T-Systems or its parent company Deutsche Telekom could not be immediately contacted for comments.
According to the Focus Online report, Tata Group's talks with T-Systems follows months-long negotiations held by other two Indian IT giants – Infosys and Wipro – for a stake in the German company.
If successful, it could be another deal after Tata Steel's Corus acquisition when a Tata Group company would acquire a company of much larger size.
TCS had reported consolidated revenue of about Rs 13,500 crore ($2.97 billion) in 2005-06, which is below T-Systems' annual revenue in 2006.
Deutsche Telekom had reported annual revenue of over 61.35 billion (about Rs 2,75,000 crore) in 2006.
Deutsche Telekom AG is an integrated telecom operator while its wholly-owned subsidiary T-Systems is a leading provider of information and communication technology service offerings with presence across more than 20 countries.
Tatas also have a strong presence in the Indian telecom sector through its companies Tata Teleservices Ltd and VSNL.
T-Systems' offerings include a full range of consulting and outsourcing services. It also provides telecom services for international carriers and corporate customers in sectors across the board.