The leading French technology consulting & outsourcing firm, Capgemini today announced that they have entered into a merger agreement to acquire IGATE, New Jersey-based IT services company for $4 billion via a cash consideration of $48 per share. The acquisition has been approved by both Capgemini’s and IGATE’s Board of Directors and has also been approved by the shareholders holding a majority of IGATE’s shares.
This transaction would lead to a group with an estimated combined revenue of €12.5 billion in 2015, an operating margin above 10% and total employees of around 190,000. Capgemini will leverage IGATE’s market in the U.S, representing 79% of revenues in 2014 to boast its presence in North America, said the company. According to a joint statement by both companies, the combination of IGATE and Capgemini will provide cross selling revenue synergies of $100-150M and annual efficiency gains estimated at $75-105M, expected to be achieved within 3 years.
Paul Hermelin, Chairman and CEO, Capgemini
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 industrialization 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.
Ashok Vemuri, CEO, IGATE
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.
