Capgemini has entered into a definitive merger agreement with IT services provider Igate. With a transaction value of $4.0 billion, the acquisition is one of the largest in the history of Capgemini and will add around 33,000 employees to its global headcount.
Igate is an in 1996 founded IT services company, which provides integrated technology and operations-based solutions to corporations in North America, Europe and Asia Pacific, including General Electric and Royal Bank of Canada. The firm that is headquartered in Bridgewater (New Jersey) has a global headcount of more than 33,000 employees and revenues of $ 1.3 billion.
In line with its strategy to expand its presence in the North American market, consulting firm Capgemini decided to acquire Igate, turning North America in its largest region with estimated combined revenues of €4 billion (30% of the total estimated revenues) in 2015.
The merger enhances Capgemini’s competitiveness across all regions and strengthens its key businesses in application and infrastructure services as well as BPO and engineering services. Igate will add a portfolio of major clients and reinforce Capgemini’s position in the retail, manufacturing and healthcare sectors. For Igate, the merger will provide a global reach and wider offering portfolio for its clients and new perspectives for its employees.
Commenting on the deal, Paul Hermelin, Chairman and CEO of Capgemini, says: “I am very pleased to announce a very important transaction in Capgemini’s history. Igate is a leading company that perfectly fits our strategic ambition. It will give us a new status on the American market, and take further our industrialisation journey to offer ever more competitive services to our clients. This will also give to the Group’s Indian operations a new scale, allowing us to compete on par with the best US-based and Indian-based companies. I am glad to welcome new talents and leaders to our Group, who share our convictions and professional culture. ”
Ashok Vemuri, CEO of Igate adds: “In Capgemini, we have found a partner that will advance our ability to innovate and build industry solutions that will enhance the value proposition we bring to our clients. In addition, this powerful combination will provide exciting opportunities for our employees to expand their capabilities.”
The transaction is expected to close in the second half of 2015, with the integration completed within nine months, and will cost Capgemini $48 per share, amounting to $4.0 billion.