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This is an archive article published on April 7, 2011
Genpact to acquire Headstrong for 550 mn
Genpact expects the transaction to be accretive to earnings per share on a GAAP basis in 2011
Written by ENS Economic Bureau
Mumbai | April 7, 2011 12:05 AM IST
2 min read
2 min read
Outsourcing giant Genpact has signed an agreement to acquire consulting and IT services firm Headstrong Corporation headed by former HCL co-founder Arjun Malhotra for a cash consideration of 550 million around Rs 2,475 crore. The transaction is being funded by a combination of existing cash and acquisition financing,and is expected to close by May 31,2011,subject to customary regulatory and other conditions.
Genpact expects the transaction to be accretive to earnings per share on a GAAP basis in 2011. Headstrong has approximately 3,700 employees in seven countries including offshore centres in India and Manila and generates a significant amount of revenue from employees who are onsite with clients in the US,the UK and Japan. It generated revenues of approximately 217 million in 2010 and Genpact expects Headstrongs long-term growth rate to be in excess of 20 per cent per year, it said.
Headstrong is a complementary high-growth business,built by talented leaders,that is an excellent fit strategically,financially,operationally and culturally. With this acquisition,we are gaining critical domain and technology expertise in the complex,but highly attractive,capital markets industry vertical, Genpact president and CEO Pramod Bhasin said. This expertise 8211; combined with capabilities in business process management BPM and smart decision services that encompass analytics and reengineering will create a uniquely powerful value proposition for clients,he added.
This transaction is the next stage of our evolution and it immediately positions Headstrong to emerge as the global leader in domain-led services to the capital markets, said Sandeep Sahai,CEO of Headstrong. Our companies combined offerings create a compelling value proposition,with significant potential to offer Genpacts extensive expertise in business process management,reengineering,high-end analytics and infrastructure support to our clients.
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