Tech Mahindra to acquire Geneva-based SOFGEN Holdings

Acquisition to give strong foothold in banking segment; deal valued at $40 mn

Tech Mahindra, the software and services company, announced on Friday that it had signed a definitive agreement to acquire Geneva-based SOFGEN Holdings (SOFGEN), a consulting and services company with presence in private, wealth, commercial and retail banking solutions.

The transaction is expected to close by March, subject to regulatory approvals. The financial details were not disclosed. But market sources confirmed it around $40 million (Rs 248 crore).

SOFGEN has approximately 450 employees, with 20 Tier-1 client relationships. Delivering solutions ‘in and around’ core banking, the company has the second largest pool of Avaloq consultants in the world and is Temenos’ most prolific partner.

According to company officials, the acquisition will give Tech Mahindra a pool of $300-500 million worth of business opportunity to tap into.

This is the sixth acquisition by the company since 2012. This will also strengthen the firms presence in the banking segment. Tech Mahindra has been trying to acquire in the banking segment for some time now.

“Bringing SOFGEN into the Tech Mahindra fold will give us access to new geographies, and a different magnitude of customer relationship.” said Alexander Dembitz, Chairman SOFGEN. “The highly experienced consultant work-force, coupled with the size and scale of Tech Mahindra will help us deliver compelling value to our prestigious customers globally.”

In 2014 alone the company had acquired four companies, the latest among them was US-based Lighbridge Communicatons Corporation (LCC) for $240 million. Acquisitions have been one of the strategy of the company to reach the $5 billion revenue target by Q3 of FY16.