Menu
Capgemini to expand in North America with $4B acquisition of iGate

Capgemini to expand in North America with $4B acquisition of iGate

The deal is being financed by a mix of cash, debt and equity

French IT services company Capgemini is to acquire iGate in the U.S. for US$4.0 billion, in a bid to expand its presence in the North American market.

The deal will boost Capgemini's revenue from North America by 33 percent to $4 billion, making the region the first to account for 30 percent of its revenue.

The iGate acquisition also brings to Capgemini additional expertise in application and infrastructure services, business process outsourcing and engineering services. Capgemini also gets iGate's clients, including key customers such as General Electric and Royal Bank of Canada, to whom it can now cross-sell its own services.

After the acquisition, the merged entity will have an estimated combined revenue of €12.5 billion ($13.6 billion) in 2015, an operating margin above 10 percent and around 190,000 employees. About 50,000 of these employees will be focused on North American clients.

iGate had revenue of $1.3 billion in 2014, of which 79 percent came from North America.

Both Capgemini and iGate in New Jersey have offshore delivery from low-cost locations like India.

The deal will be financed through a combination of Capgemini's own cash, debt and an equity portion that will not dilute its share capital by more than 6 percent.

The boards of both companies have approved the merger. It has also been approved in writing by a majority of iGate shareholders. The transaction is expected to close in the second half of 2015, subject to customary closing conditions such as regulatory approvals.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com


Follow Us

Join the newsletter!

Error: Please check your email address.

Tags business issuesservicesoutsourcingiGateMergers and acquisitionsCapgemini

Featured

Slideshows

Meet the top performing HP partners in NZ

Meet the top performing HP partners in NZ

HP honoured leading partners across the channel at the Partner Awards 2017 in New Zealand, recognising excellence across the entire print and personal systems portfolio.

Meet the top performing HP partners in NZ
Tech industry comes together as Lexel celebrates turning 30

Tech industry comes together as Lexel celebrates turning 30

Leading figures within the technology industry across New Zealand came together to celebrate 30 years of success for Lexel Systems, at a milestone birthday occasion at St Matthews in the City.​

Tech industry comes together as Lexel celebrates turning 30
HP re-imagines education through Auckland event launch

HP re-imagines education through Auckland event launch

HP New Zealand held an inaugural Evolve Education event at Aotea Centre in Auckland, welcoming over 70 principals, teachers and education experts to explore ways of shaping and enhancing learning using technology.

HP re-imagines education through Auckland event launch
Show Comments