Country's third largest software exporter Wipro today said it will acquire Australian firm Promax Applications Group (PAG) for AUD 35 million (about Rs 192 crore), a move which will allow the Indian company to strengthen its analytics solutions portfolio.
PAG, which offers trade promotion planning, management, and optimisation solutions, is headquartered in New South Wales and has offices in US, UK and Japan.
"Analytics is a key growth driver of Wipro's growth strategy. The acquisition will strengthen our position and capability in management, analytics and optimisation of trade promotions," Wipro Senior Vice President and Global Head (Analytics and Information Management) K R Sanjiv told reporters on a conference call.
Combining expertise of both companies will enable our clients to maximise the return on investment (RoI) on trade promotion spends, he added.
The newly formed entity will be called Wipro Promax Analytics Solutions Pty Ltd. Avendus Capital acted as the exclusive financial advisor to Wipro on this transaction.
As per industry estimates, consumer focused companies spend 12-25 per cent of their gross annual sales on trade promotions.
"The acquisition helps us in not only strengthening our analytics business, but also cross-selling (other products) to some of PAG's marquee customers," Wipro Chief Strategy Officer Rishad Premji said.
PAG has 45 customers in segments like food and beverages, pharmaceuticals and white goods.
"Organisations are increasingly leveraging analytics to enhance effectiveness and maximise the RoI of their spend on trade promotions. That is where the strong growth is coming from," Sanjiv said.
The all-cash deal is expected to close in the ongoing quarter. PAG, which follows a July-June fiscal, is expected to close the year with AUD 15-16 million in revenues. It has headcount of 71 people.
Sanjiv said Wipro's analytics and information management segment, which is growing at a strong pace for the company at about 25 per cent, has 8,000 people and revenues of about USD 600 million.
Asked about the company's merger and acquisition strategy, Premji said the company continues to remain active.
"We will look at opportunities and areas like mobility, analytics and cloud. The next one is geographic expansion," he added.
Wipro has been known for its 'string of pearls' strategy of making small ticket acquisitions. Last year, the company acquired the oil and gas IT unit of US-headquartered Science Applications International Corp (SAIC) for USD 150 million in an all-cash deal.
Its other acquisitions include Infocrossing and Citi Technology Services.
