Capgemini completes IGATE buyout

Igate becomes an indirect wholly-owned subsidiary; to delist from Nasdaq

Two months after announcing its decision to acquire iGate, European IT services and consulting company Capgemini has announced the completion of the process.

The transaction is expected to be accretive to Capgemini normalised earnings per share (EPS) by at least 12 per cent in 2016 and 16 per cent in 2017, it said.

“Our combined operations in India have now reached the size to compete at par with the world leaders in our industry. It will also benefit our customers by taking further our industrialisation and innovation initiatives. On behalf of our group, I’m glad to welcome the 31,000 people of IGATE to Capgemini,” said Paul Hermelin, Chairman and CEO of Capgemini.

In April this year, the French IT major had announced to acquire IGATE for a total consideration of around $4 billion, a little over than three times of IGATE’s sales reported in 2014. Post the completion of the merger, the estimated combined revenue is estimated to touch €12.5 billion in 2015 with an operating margin above 10 per cent and employee base of 190,000 employees.

“This acquisition represents a major step in Capgemini’s history. With Igate, our operations in North America have taken a new dimension and are now our largest market in revenues,” Hermelin added.  Capgemini said pursuant to the terms of the merger agreement, IGATE has become an indirect wholly-owned subsidiary of Capgemini, and iGate’s shares will cease trading and will be delisted from Nasdaq.