Porsche sold its IT consultancy MHP to TCS and signed a five-year AI partnership

Porsche and Tata Consultancy Services signed an agreement on August 24 providing for the sale of the management and IT consultancy MHP to TCS, both companies said in releases published the same day.

TCS will acquire 100 percent of MHP Management- und IT-Beratung GmbH through a subsidiary, TCS said in its own release. MHP employs more than 4,500 people worldwide and is based in Ludwigsburg, near Stuttgart. It will keep its brand and continue to operate under its existing name inside TCS.

Neither release gave a price. In a filing to India’s stock exchanges the same day, TCS said the board of its wholly owned subsidiary Tata Consultancy Services Netherlands B.V. had approved the acquisition for an enterprise value of 320 million euros, excluding customary post-closing adjustments for net debt and working capital. The same filing put the five-year deal Porsche signed with MHP and TCS at 1.25 billion euros.

Alongside the sale, Porsche signed a five-year strategic partnership with TCS covering engineering, manufacturing, operations and customer experience. TCS said it would set up a dedicated artificial-intelligence center for Porsche, whose stated role is to convert AI ideas into what the company called “secure and scalable solutions” across Porsche’s product and value chain. Porsche described the divestment as a further step in focusing on its core business under its Sportwagenschmiede 35 strategy, and said MHP would remain a partner for its own digitalization work after the change of ownership.

The transaction remains subject to regulatory and competition approvals. Porsche expects it to be finalized in the coming months. Deutsche Bank acted as financial adviser and Noerr as legal counsel to TCS.

Porsche listed MHP’s future growth areas as artificial intelligence, software-defined manufacturing, supply chain management, integration and scaling, cyber security, program management, and platforms and ecosystems.