Wipro (WIT) Announces Corporate Demerger
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The Board of Directors of Wipro Limited (NYSE: WIT) in their meeting held today, approved the demerger of the Wipro Consumer Care & Lighting (including Furniture business), Wipro Infrastructure Engineering (Hydraulics & Water businesses), and Medical Diagnostic Product & Services business (through its strategic joint venture), into a separate company to be named Wipro Enterprises Limited. Wipro Limited will remain a publicly listed company that will focus exclusively on information technology. Wipro Enterprises Limited will be an unlisted company.
In fiscal year 2011-12, the IT business contributed to 86% of revenue and 94% of operating profit of Wipro Limited. The demerger is anticipated to provide fresh impetus for both Wipro Limited and Wipro Enterprises Limited to pursue their individual growth strategies. The demerger is also expected to improve the competitiveness in their respective markets.
The Board of Wipro Limited will remain unchanged, and the demerger will have no impact on the management structure of Wipro Limited. There will be no change in the leadership of any of Wipro Enterprises Limited’s constituent businesses. Wipro brand will be jointly owned by both the companies.
In fiscal year 2011-12, the IT business contributed to 86% of revenue and 94% of operating profit of Wipro Limited. The demerger is anticipated to provide fresh impetus for both Wipro Limited and Wipro Enterprises Limited to pursue their individual growth strategies. The demerger is also expected to improve the competitiveness in their respective markets.
The Board of Wipro Limited will remain unchanged, and the demerger will have no impact on the management structure of Wipro Limited. There will be no change in the leadership of any of Wipro Enterprises Limited’s constituent businesses. Wipro brand will be jointly owned by both the companies.
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