Wipro has agreed to acquire Capco, a multinational management and technology consultancy headquartered in London, for $1.45 billion. This is Wipro’s largest purchase to date.
Capco is providing multimedia, consultancy, and infrastructure services to financial firms in the Americas, Europe, and the Asia Pacific.
The transaction is all-cash and will be financed by existing accruals and debt. The deal is scheduled to close in the second quarter of this year, subject to normal closing conditions and regulatory approvals.
Rishad Premji, Chairman, Wipro, said: “With such a contract, we are partnering select service providers to offer end-to-end, digital cloud and IT-driven technologies to our consumers on a scale. This deal would carry Wipro’s BFSI (banking financial services and insurance) size to play,” Premji said.
“This transaction is a growth driver for Wipro,” said Chief Executive Officer Thierry Delaporte. Also, They provide a complimentary user base that provides complete access to 30 BFS (banking and financial services) consumers that can improve access to business solutions significantly.
“We are pleased to join our new colleagues at Wipro,” said Lance Levy, CEO of Capco. “United, we will create a stronger leader in the finance sector by delivering tailor-made truly revolutionary edge approaches, now fueled by innovative technology on a scale. We’re looking forward to using the complementary talents and shared cultures of both companies,” he added.
Although investors who follow the group said it was a risky decision, several speculated that it was an opportunity to boost sales.
“Wipro has benefited from Capco’s presence. Wipro’s wealth management division will be strengthened, and its UK and European activities will gain size. Wipro’s chief executive officer has identified both as areas that need to be improved. It demonstrates that Wipro is adopting an acquisitive strategy under his leadership, with the company expected to acquire more size and capabilities within the next year or two,” said Peter Bendor-Samuel, Everest Group’s chief executive officer.