Wipro secures $300 million worth IT contract from ICICI Bank

The IT firm to buy out this business from Vara Infotech for Rs 321 crore; to absorb 3,800 staffers

IT services company Wipro on Wednesday said it has bagged an IT outsourcing contract worth around $300 million (around Rs 2, 200 crore) from ICICI Bank under which it would provide a comprehensive suite of services to the lender.  

As a part of the contract which has a tenure of 7 years, Wipro entered into a business transfer agreement with Vara lnfotech, a Mumbai based company, for an all cash consideration of Rs 321 crore. Vara Infotech currently provides IT services to ICICI Bank, and post acquisition of this business, Wipro will be the new service provider to the lender.

As a part of this strategic engagement, Wipro will absorb about 3,800 employees of Vara lnfotech along with its existing contracts, facilities and assets, the Bengaluru-headquartered company said in a filing to the stock exchanges. Wipro will provide these services to ICICI Bank from September 2019, it added.

According to Wipro, Vara Infotech's revenue from these services stood at Rs 221.5 crore in FY19. "This transaction is expected to be completed during the quarter ending September 30, 2019 and is subject to customary closing conditions," Wipro added.

Vara Infotech is a software solution and services company which provides services catering to the Banking, Financial Services and Insurance (BFSI) segment, according to its website. The company offers services in the areas of business process management (BPM), infrastructure management system (IMS) and application.  

Wipro drew around 32 per cent revenue from BFSI segment in the first quarter ended June of this fiscal year, which rose 11.2 per cent year-on-year on constant currency basis. "This engagement will further strengthen our endeavour to provide differentiated technology and digital capabilities to the financial services industry," the company said.