- North America to represent 30% of the Group’s estimated combined revenues of €12.5bn in 2015
- Enhances Capgemini’s competitiveness across all regions and broadens its offerings in key verticals
- Global delivery centers headcount to cross the 100,000 employees mark in 2015 competing on par with the best industry leaders
- Provides a global reach and a wider offering portfolio for IGATE’s clients and new perspectives for its employees
- Strengthens the economic model of the Group through revenue synergies and efficiency gains
- Financially attractive: normalized EPS accretion of at least 12% in 2016 and 16% in 2017
IGATE is a prominent US-listed technology and services company headquartered in New Jersey with 2014 revenues of $1.3 billion, double-digit growth and a 19% operating margin2. North America is IGATE’s largest market representing 79% of revenues in 2014 followed by Europe (14%) and Asia-Pacific (7%). IGATE strengthens Capgemini’s key businesses in application and infrastructure services as well as BPO and engineering services. Moreover, the transaction enriches Capgemini’s portfolio with new flagship clients such as General Electric and Royal Bank of Canada.
This transaction would lead to a group with an estimated combined revenue of €12.5 billion in 2015, an operating margin above 10% and around 190,000 employees. The combined Group will pass the 100,000 employees landmark in its Rightshore® delivery centers in 2015.
This transaction fulfills one of the essential components of Capgemini’s strategy in expanding its presence in the North American market.
Scaling up in North America
Reinforcing sector expertise notably in financial services
Enlarging capabilities and offering portfolio
Enhancing the Group’s competitiveness
Strengthening the economic model
Straightforward integration
Financially compelling transaction
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. I am glad to welcome new talents and leaders to our Group, who share our convictions and professional culture.”
Ashok Trivedi, Co-Founder and Co-Chairman of IGATE said: “We are pleased to have found a great partner for the business and are confident that our employees and customers will benefit from the enhanced service offerings and resources available to them at Capgemini.”
Sunil Wadhwani, Co-Founder and Co-Chairman of IGATE said: “We are gratified that the company we founded over 25 years ago has developed into a global enterprise with over 30,000 employees, a trusted partner to over 250 clients, a market value of over $4 billion, and one of the most respected brands in the IT industry.”
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.”
Transaction highlights
The merger is subject to the customary closing conditions, including regulatory approvals. The transaction is expected to close in the second half of 2015.
This transaction will be financed through a combination of:
- own cash
- equity portion translating into a dilution not to exceed 6% of Capgemini share capital
- straight debt for the remaining portion.
ANALYST INVESTOR CALL: 8:00 CET (PARIS)
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NORTH AMERICA ANALYST INVESTOR CALL 14:00 CET (PARIS)
Participant to call the dial-in:
Standard International: +44 (0) 1452 589509
Toll-free local UK: 0800 694 5723
Toll-free local FRANCE: 0805 11 09 81
Toll-free local US: 1 866 434 1115
Participant Conference ID to be provided: 36538501
Replay
Dial In Numbers:
Standard International: +44 (0) 1452 550000
Toll-free local UK: 0800 953 1533
Local FRANCE: 0805 11 13 37
Local US: 1 866 247 4222