Indian IT corporation Wipro has signed an agreement to buy Capco, a multinational management and technology consultancy headquartered in London, for $1.45 billion.
While announcing its biggest acquisition yet, Wipro said that the deal will provide it access to 30 new large banking and financial clients, as well as strengthen its position in the Banking, Financial Services and Insurance (BFSI) sector.
“With this deal, we are joining select service providers that bring end-to-end consultative, digital cloud, and IT-driven solutions at scale to our customers. The banking and financial services industry is our largest sector globally, and a high priority and growing segment for us Capco will bring significant scale to our BFSI business, a highly complementary set of service offerings, creating a unique combination of consulting and domain-led expertise with scale, digital technology, and operations. This, we believe, will drive accelerated growth.”
In the December 2020 quarter, the BFSI segment accounted for over 30 percent of Wipro’s IT services revenue of $2.07 million.
The deal will expand Wipro’s presence into a broad range of customers that are complementary to the company’s current customer base, as well as provide a platform to utilize Capco’s deep relationships with CXOs and business leaders of many large customers over the years.
The agreement also comes at a time when businesses are betting on technology and increasing their digital spending to help them thrive globally during the pandemic.
Mr. Thierry Delaporte Chief Executive Officer of Wipro pointed out the deal is being funded with internal cash and debt, that regulatory approvals are still pending. It is scheduled to close in the quarter ending June 2021, pending regulatory approvals and other normal closing conditions.
Capco, which was established in 1998, has over 100 clients and several long-standing partnerships with some of the world’s leading financial institutions. It has over 5,000 consultants based in more than 30 global locations across 16 countries.