New Delhi (Anish Yande): Wipro Ltd is set to acquire Capco, an IT consultancy firm in the UK. The Indian IT firm is paying $1.45 billion to acquire the IT company. The deal is the biggest ever amount issued by Wipro for a buyout. The Indian IT firm stated that it seeks to become a "bolder and ambitious" company.
Wipro finalizes buyout of Capco:
Capco, the IT firm based out of London, is a technology and business management consultancy firm that provides various financial services and comes with a dedicated energy division. The IT firm has 29 offices spread across Europe, Asia Pacific.
The company had generated a revenue of $720 million in 2020. Half of the generated income was acquired from banks and financial institutions. Capco has more than 5,000 employees across the world, along with hundreds of employees in India.
Wipro's goals through acquisition:
Wipro had reported profits of Rs 7,892 crore in the nine-month period till December 2020. The IT firm had recorded revenues of Rs 45,698 crore in the period. Wipro had recorded profits of Rs 9,720 crore in fiscal 2020 and a revenue of Rs 61,023 crore.
The acquisition is expected to increase Wipro's revenue from banking, financial services, and insurance from $2.5 billion to $3.2 billion through the deal. The acquisition is set to be finalized in the quarter ending June 2021.
CEO of Wipro, Thierry Delaporte had stated that the transaction is financed through internal cash and debt. The acquisition is subject to regulatory approvals.
Thierry Delaporte expects the acquisition to transform Wipro into a service-providing firm that offers solutions for digital, cloud, and IoT transformation to customers.
The buyout of Capco is the fourth acquisition by Wipro since July 2020, under Thierry Delaporte's management. In the financial year 2020-2021, Wipro has acquired a stake in Eximus for USD 80 million.
Indian IT firm has also acquired a stake in IVIA for USD 22.4 million and acquired a majority stake of 83.4 percent in Encore Theme Technologies for up to Rs 95 crore.
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