Report: Infosys considering Capgemini acquisition

Report: Infosys considering Capgemini acquisition

Rumours say Capgemini acquisition is on the cards but Infosys declines comment

India's second largest outsourcer, Infosys Technologies, is considering a bid for French IT services company, Capgemini, according to a newspaper report.

The Times of India of Mumbai quoted an industry source last Friday as saying the move was a natural progression for a fast-growing Indian tech firm keen to make an impression on the global market.

Infosys declined to comment on the reports. "We do not comment on market rumours," a company spokesperson said. However, Infosys, in Bangalore, indicated at its analyst conference in April that it may consider an acquisition.

A number of Indian outsourcing companies including Tata Consultancy Services (TCS) and Wipro have acquired companies abroad to increase their geographic reach and to focus on new industry sectors.

Capgemini used acquisitions as a way to win new business and add staff in India.

Last year, the company acquired a 51 per cent stake in Unilever India Shared Services Ltd, a subsidiary of European consumer goods maker, Unilever Group. That business will become a wholly owned subsidiary of Capgemini by 2008. In February, Capgemini acquired Kanbay International, an IT services firm, to boost its services delivery from India, and its business in the financial services sector.

Infosys reported revenue of $US3.1 billion for the fiscal year ended March 31 this year, and has forecast revenue of about $US4 billion in its current fiscal year ending March 31 next year. The company had a market capitalisation of $US27 billion as of March 31. Capgemini is a larger company with revenue of $US10 billion for its fiscal year ended December 31.

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