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Europe is now the second biggest market for domestic IT service providers after North America. Tata Consultancy Services (TCS) has been operating in France since 1992 and has more than 50 clients in the country. The Indian IT company has expanded in the country over the last five years through local hiring and investments. The latest acquisition will help transform TCS into a major player in France, the third-largest IT services market in Europe, and provide the firm access to blue-chip French and European clients in banking, luxury, manufacturing and utilities sectors.
For TCS, the acquisition is important for two reasons. First, though Europe’s contribution to the TCS revenue is 26.6 %, continental Europe’s contribution is about just 9.1 %; the chunk of revenues continues to come from the UK. TCS will report its fiscal fourth quarter and annual results on April 17.
Here’s a look at some of the IT companies' major acquisitions over the years
In Februray 2013, Bangalore-based IT firm MphasiS acquired US-based Digital Risk LLC, one of the largest independent providers of solutions related to risk, compliance and transaction management to the US mortgage market. Following the acquisition, Digital Risk LLC and its subsidiaries are now the wholly owned subsidiaries of the MphasiS. Digital Risk will operate as a standalone business unit within MphasiS, retaining its brand identity. Earlier in December, MphasiS had announced its plan to buy Digital Risk in an all cash deal for $175 million with an additional earn-out component.
In 2012, information technology (IT) services provider Wipro announced it had signed an agreement to acquire Australian analytics company Promax Applications Group (PAG) for a $35 million (around $36.5 million or Rs 192 crore). Promax derives its revenues by licensing software products and solutions in trade promotion planning, management and optimisation. Founded in 1989, the New South Wales-headquartered company employs 71 people across the globe.
In 2012, Infosys announced its major acquisiton of Lodestone Holding, a Switzerland-based consulting company specialising in business software from Germany's SAP, for about $350 million ( Rs 1,932 crore), giving it better reach in continental Europe.
In December 2011, Infosys said its BPO division has signed a definitive agreement to acquire Australia-based Portland Group for A $37 million (Rs 195.44 crore). Portland Group is a provider of strategic sourcing and category management services."The Group's expertise in strategic sourcing and category management services will complement the global sourcing and procurement platform at Infosys BPO. It will have a positive impact on our clients' business efficiency and effectiveness," Infosys BPO CEO Swami Swaminathan said. Portland Group, headquartered in Sydney, has offices in Melbourne, Brisbane and Perth. The company reported a revenue of approximately a $ 31.3 million for the fiscal year ended 30 June 2011 and employs 113 professionals.
On 15 December 2008, HCL Tech acquired the UK based AXON Group for US$658 million, which was renamed HCL Axon., Axon Group Plc -- the country's largest overseas acquisition in the IT space. The company said the new structure to contribute around $600 million (around Rs 2,880 crore) -- around 30 % of HCL’s revenues. The deal gave HCL new capability to implement large enterprise software projects
In 2011, Wipro Technologies, the global information technology (IT) business of Wipro Ltd, has acquired the oil and gas IT practice of US-headquartered Science Applications International Corp. (SAIC) for $150 million (Rs670.5 crore) in an all-cash deal. The Rs 670 crore acquisition was seen as a strong signal from new chief executive officer T.K. Kurien and chief strategy officer Rishad Premji, in charge of acquisitions, that they will do whatever it takes to step up the pace of growth.
In 2008, Tata Consultancy Services (TCS) signed an agreement with Citigroup Inc to acquire its captive BPO-Citigroup Global Services (CGSL) for $505 million (around Rs 2,424 crore) in an all-cash transaction. In addition to the sale, Citi has signed an agreement with TCS to provide, through CGSL, process outsourcing services to Citi and its affiliates in an aggregate amount of $2.5 billion over a period of 9.5 years.
In Sep 2012 Tech Mahindra acquired Hutchison Global Services (HGS) for $ 87.1 million (about Rs 482 crore), a move that helped the company expand its IT and BPO businesses. Tech Mahindra, a subsidiary of vehicle manufacturer Mahindra & Mahindra, acquired the BPO company by paying upfront. As part of the deal, HGS’ clients also committed business worth $845 million over a five-year period. . As part of the deal, Tech Mahindra will get committed business of $ 845 million over a five-year period. In addition, Hutchison Global became the exclusive provider of 'certain agreed services' in India.
In Jan 2011 Bangalore headquartered iGate Corporation, a mid-size IT company, has signed a definitive agreement to acquire Mumbai’s Patni Computer Systems (Patni), another mid-size IT company. The $1.2-billion acquisition was funded by $770 million debt, $330 million by issuing convertible preferred stock to Apax Partners, the PE firm with which it formed a consortium to make this acquisition, and using cash on hand. One of the largest deals in the Indian IT industry in recent years, this propelled iGate to the billion dollar league, making it easier for the company to win larger deals.
In July 2011, Cognizant Technology Solutions, a U.S. outsourcer with large Indian operations, entered into a definitive agreement to acquire the Indian services operations of CoreLogic, an information services and analytics company, in a bid to increase its services capabilities for the mortgage industry. The purchase price included a cash payment of about $50 million, plus adjustments for working capital and other charges or credits that was determined at closing. Cognizant as part of the transaction entered into a services agreement with CoreLogic for a minimum revenue commitment of $324 million over five years to provide services to CoreLogic and its customers.
