French IT services company Cap Gemini SA has agreed to acquire almost all the consulting activities of Ernst & Young, the companies announced on Tuesday.
Cap Gemini will begin by acquiring the Ernst & Young Consulting businesses in the US, Canada, UK, Germany, France, Spain and Italy, subject to a vote by the partners in the Ernst & Young businesses, Cap Gemini said in a statement.
Combining the two groups' consulting activities will enable Cap Gemini to become a major player in the US, which should represent over one third of its revenues, the company said.
Ernst & Young Consulting businesses in Sweden, Norway, Finland, Denmark, The Netherlands, Belgium, Australia and New Zealand are expected to join the deal in the following weeks.
If all Ernst & Young consulting businesses take part in the merger, Cap Gemini will issue a maximum of 43.5 million new shares and pay 375 million euro ($A600 million), Cap Gemini said.
The completion of the proposed merger is subject to approval by Ernst & Young partners, with votes counted country by country. The votes should be tallied by April, the companies said. Following the Ernst & Young vote, Cap Gemini shareholders will vote on the merger at the end of June.http://www.capgemini.comhttp://www.ey.com