In the largest ever acquisition made in the history of the company, Wipro has signed a definitive agreement to acquire London-headquartered management and technology consultancy company Capco, which provides digital, consulting and technology services to financial institutions in the Americas, Europe and the Asia Pacific region. The acquisition is an all cash deal and is expected to be completed during the quarter ending June 30, 2021, subject to regulatory approvals of anti-trust in the United States of America, Germany, Canada, Brazil and Austria.
Capco works with more than 100 clients, some of whom include the world’s leading financial institutions. It has over 5,000 consultants who will now be a part of Wipro. The deal will be financed through internal cash and debt. On the investor call, Wipro Chairman Rishad Premji said that the acquisition was is in line with what the company had stated earlier that it would be a “bolder, ambitious and risk-taking Wipro” in the future.
What the deal brings to the table
With the acquisition of Capco, Wipro hopes to expand its footprint in the banking and financial sector as an end-to-end integrated consulting, IT and operations player and expand its share of wallet with existing clients in both the organisations. It will also provide access to nearly 30 big financial services clients, and also enhance market access.
Explaining the synergies over an investor call, Thierry Delaporte, CEO and Managing Director, said, “Acquiring Capco helps us grow our global financial business, which is our largest business, from current $2.5 billion to $3.2 billion with a strong consulting footprint.” While Capco will continue to independently function, the acquisition will bring access to deeper digital transformation, data, engineering and business operations capabilities of Wipro that will help enable end-to-end transformation for the clients.
Capco’s revenue for the calendar year 2020 stood at $700 million with the top 30 clients bringing in 79 per cent of its revenues. With 51 per cent of revenues from banking and payments and 34 per cent from capital markets from a sectorial standpoint, Capco has its footprint in regions including the US, UK, France, Germany, Poland, Slovakia, Austria, Poland, Switzerland, Brazil, India, Singapore, Malaysia and Hong Kong.