Capgemini to Acquire IGATE

North America becomes the largest region of the Group with this major acquisition.
One of the largest in the history of the Group, Capgemini and IGATE entered into a definitive merger agreement under which Capgemini will acquire IGATE. IGATE is a prominent US-listed technology and services company headquartered in New Jersey (US), with revenues over US$ 1.2 billion, double-digit growth, 19% operating margin in 2014 and a global employee talent capital of 33,000.

The transaction will amount to $4.04 billion and is expected to be immediately accretive to Capgemini’s operating margin and Earnings Per Share.

The combined Group strengthens Capgemini’s position as a leading company in IT services, outsourcing and consulting, with an estimated combined revenue of €12.5 billion, combined operating margin above10% and around 190,000 people serving clients worldwide. Capgemini Chairman and CEO, Paul Hermelin welcomes “new talents and leaders to our Group, who share our convictions and professional culture.”

This important move is fully in line with the Capgemini Group’s strategy:
 
North America, the largest and most innovative market for IT services, would be by far the first market of the Group, with approximately 30% of the combined Group revenue for 2015. With IGATE, Capgemini would quicken its pace to respond to key, fast growing and innovative markets.

The new company also stands to offer more platform-based and intellectual property-based solutions to help clients respond to and stay at the forefront of their market.

These will be supported by the combined, proven delivery models, notably IGATE’s ITOPS and Capgemini’s Rightshore, to ensure increased efficiency and competitiveness, and complemented by the additional Talent pool; a sign of further industrialization from the combined Group to offer greater flexibility and scalability to its clients in all regions. The offshore leverage of the combined Group would be brought to 55% by end of 2015, with over 90,000 headcount in Rightshore delivery centers.

With its key position in the financial services sector, IGATE brings an attractive portfolio of major clients, notably in bank and insurance, complementary to those of Capgemini. The transaction also reinforces Capgemini’s position in retail, manufacturing and healthcare.
With new Talent, experts and solutions, IGATE and Capgemini open opportunities to consolidate cost synergies and revenue synergies from cross-selling opportunities. Fully in line with the Capgemini Group’s strategy, this operation is a strong business and cultural fit for both clients and the newly formed Group. 

Capgemini to Acquire IGATE: Both CEOs Share Their Ambitions and Business Perspectives

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Read the full Press Release in English

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The intended transaction is subject to customary closing conditions, regulatory and antitrust approvals, and consultation, when relevant, with employee representative bodies. The transaction is expected to close in the second half of 2015.