Competition watchdog CCI has approved the proposed merger of Mahindra Satyam and other companies with Tech Mahindra, creating a USD 2.4-billion entity.

"Considering the facts on record and the details provided in the notice... and the assessment of the proposed combination is not likely to have an appreciable adverse effect on competition in India and therefore, the Commission hereby approves the proposed combination...," CCI said.

In its order, Competition Commission of India (CCI) said that the companies involved in the proposed combination are predominantly engaged in the export of IT & ITeS and their combined market share in the domestic industry is insignificant, CCI said.

Besides, Mahindra Satyam, the companies to be merged into Tech Mahnidra are Venturbay Consultants, C&S Systems, Mahindra Logisoft and CanvasM.

Earlier, Tech Mahindra vice-chairman and managing director Vineet Nayyar had said that the merger with Mahindra Satyam would make Tech Mahindra a company with an annual revenue of USD 2.4-billion approximately, with more than 75,000 workforce and over 350 active clients speard across 54 countries.

The merger ratio is pegged at 8.5:1, which means share holders get 8.5 share of Mahindra Satyam for each share of Tech Mahindra.

Tech Mahindra took over the reins of the scam-hit Satyam Computer Services in April 2009 by picking up 31 per cent stake for USD 351 million at Rs 58 per share, a 23 per cent premium, in a government monitored deal.

The company was rebranded as Mahindra Satyam.

The deal saw the Mahindras edging out existing partner engineering conglomerate Larsen & Toubro, widely seen as a front-runner, and private equity firm WL Ross & Co.