Mindtree to buy US firm Discoverture for USD 15 mn

Mindtree will acquire US-based insurance solutions provider Discoverture Solutions for USD 15 million (over Rs 92 crore), a move aimed at helping the mid-sized Indian IT firm tap the USD 1.5 billion opportunity in the global P&C services market.
The acquisition will also help Mindtree gain access to 15 marquee clients and add over 300 experts across US, UK, Canada and India.
"This is a USD 15 million, all-cash deal and has been funded completely through internal accruals. The addition of Discoverture along with our existing offerings will accelerate our journey to be amongst the top 3 service providers in the Global P&C (property and casualty) services industry," Mindtree CEO and MD Krishnakumar Natarajan told PTI.

Founded in 2002 and headquartered in Arizona, US, Discoverture has subsidiaries in the UK, Canada and Bhubaneswar in India.
The acquisition is subject to customary closing conditions and regulatory approvals. BMR Advisors acted as the sole financial advisors for the transaction, which is expected to close in the next 4-6 weeks.
"The packaged implementation market in the life and property insurance market is estimated to be between USD 1.2 billion to USD 1.5 billion. This is a huge growth area and we see a huge potential here," Natarajan said.

He added that there is no overlap with Discoverture, which has about 15 clients and along with its own set of 18 customers, Mindtree has the opportunity to cross and upsell joint offerings.

"We are excited to add our technology and expertise to its large and growing insurance practice. As part of Mindtree, we can now engage our skills and technology with its full service capabilities to deliver greater value to insurance clients," Discoverture President Steve Addair said.
Of the over 300 people coming on board as part of the acquisition, about 275 are located at the Bhubaneswar facility.
"We have one of our biggest campuses coming up in Bhubaneswar. It is spread over 20 acres and we have invested Rs 125 crore. The acquisition will provide a jump start to that," Natarajan said.