Paris-headquartered IT services and software company Capgemini has acquired iGate for USD 4.04 billion. This acquisition is one of the biggest and largest in the IT services space.
Both Capgemini and IGATE on 27th April 2015 has announced that they have entered into a definitive merger agreement under which Capgemini will acquire IGATE for a cash consideration of USD 48 per share.
The merger agreement has been approved unanimously by both Capgemini’s and IGATE’s Board of Directors. The transaction has also been approved by the written consent of shareholders holding a majority of IGATE’s shares.
This transaction is expected to close in the second half of 2015 and will be financed through a combination of:
Equity portion translating into a dilution not to exceed 6% of Capgemini share capital
Straight debt for the remaining portion.
IGATE is a prominent Nasdaq-listed technology and services company with revenues over US$ 1.2 billion.
Post acquisition, the combined revenue of the group is estimated to be USD 12.5 billion. Combined operating margin is expected to be 10% and around 190,000 people will be serving clients worldwide. IGATE to become subsidiary of Capgemini North America Inc.
Paul Hermelin, Chairman and CEO of Capgemini said “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 of IGATE said “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.”
Watch this Video where Both CEOs share their ambitions and business perspectives;