The acquisition will add 1,900 employees, taking the Warburg Pincus-backed Quest's total strength to 6,850.
About 4,500 of these employees are in India, 1,350 in the US and 1,000 in Europe, a press release said.
Most of Quest's India employees are in Bengaluru and Belagavi and that of NeST in Thiruvananthapuram.
Quest said its revenue in the year ending March 2014 was USD 251 million (Rs 1,500 crore) and expects that to grow organically - excluding NeST - to USD 290 million (Rs 1,740 crore) this year.
More From This Section
The acquisition is a significant move in its diversification strategy for 2020 and will strengthen the width and depth of engineering service offering to QuEST's customers in terms of engineering software, embedded systems, mechanical systems and structures, the release said.
It would also enhance QuEST's capabilities in energy and transportation and add on other verticals such as healthcare, communication and consumer, semiconductor to QuEST's portfolio, besides helping it gain a stronger presence in its core target markets of the US, Western Europe and Japan.
With over 1,900 employees, NeST Software, like QuEST, has vast experience in establishing and operating dedicated off shore development centres for global MNCs.
The company currently offers product engineering, value engineering and sustenance services across research, development, validation, and in service stages of product life cycle, it said.
"We were looking for a potential consolidator who has a proven track record, market reputation and engineering focus just as NeST. QuEST was the best fit," NeST Group Founder and Chairman Javad Hassan said, adding that together "QuEST and NeST Software have significant growth opportunities".