NEW DELHI: Infosys, the second-largest IT services provider in India, is on the lookout for more acquisitions following two successful purchases this year. The company is open to deals that match the size of its recent technology acquisitions.
The CEO of Infosys, Salil Parekh in an interview with PTI said that the company is focusing on potential acquisitions in fields such as data analytics and SaaS and exploring some geographies within Europe, and the US.Regarding future acquisitions potentially matching the scale of “in-tech”, which had a price tag of 450 million euros, Salil Parekh stated, “Absolutely, we are considering deals of that size. Given our structure, we could pursue a few such acquisitions.”
Parekh expressed confidence in the company’s existing engineering services business and the recent acquisitions, stating that “we have very good business in engineering services already within Infosys and then we did those two acquisitions, both of them in engineering services, one on semiconductor side and one on the automotive side… very strong businesses, and we feel quite good about expanding that footprint.”
The Infosys top honcho said the company is eyeing more acquisitions and evaluating several firms. “We have a good balance sheet and good cash generation and now we are quite comfortable with the integration of acquisition in different areas. We have done engineering services, we will look at other areas… for example data analytics… may look at SAAS (software as a service) areas, and maybe at some other geographies in Europe, maybe the US as well,” he said.
“We are continuing to look, and we have things that are normally in the pipeline but those take their own time… there are a lot of discussions on strategic fit, on financial cost of it and cultural fit into the company and then how will we integrate them. Many of those discussions are ongoing and we will see what comes out,” he added.
Parekh expressed uncertainty regarding the timeline for completing additional acquisitions within the current fiscal year, despite ongoing discussions with potential targets.
“It is difficult to say… we are evaluating several (of them). But to get a fit on the strategic parameters, financial parameters, culture, integration… all of it may not work out. But these two (InSemi and in-tech) happened relatively quickly… before that for some quarters we had not done anything. It is not a predictable thing, but the evaluation is ongoing,” he told PTI..
Earlier this year, in January, Infosys announced a definitive agreement to acquire InSemi Technology Services, a semiconductor design services company based in India, for a total consideration of up to Rs 280 crore, including earn-outs, management incentives, and retention bonuses.
Just three months later, in April, Infosys Germany, a wholly-owned step-down subsidiary, entered into a definitive agreement to acquire in-tech Holding, a leading provider of engineering R&D services headquartered in Germany, for a consideration of up to 450 million euros (approximately Rs 4,045 crore).