TCS To Acquire Alti SA

Inorganic growth seems to be gaining momentum in the Indian IT industry. A number of companies have announced acquisitions in the recent past. The latest one to do so is TCS, which has signed an agreement to acquire 100% equity shares in Alti SA for a value of 75 million euros in an all-cash transaction.

Alti is a leading IT services company in France with a strong expertise in enterprise solutions, assurance and CRM solutions. It is a privately-held company owned by its management and two private equity funds, CM-CIC LBO Partners and IDI. The company is regarded as one of the top 5 system integrators of enterprise solutions in France.

Apart from a strong presence in France, Alti has subsidiaries in Belgium, Switzerland and Algeria. It has 1,200 employees and a stronghold in areas of business consulting and SAP, new technologies and business intelligence. In 2011, Alti’s revenues were 127 million euros. Its operational profit and net profit stood at 9.1 million euros and 6.8 million euros respectively.

The acquisition will help TCS boost its presence in France. France is the third largest IT services market in Europe (after the UK and Germany) and is assessed at over 30 billion euros. TCS has a strong presence in France and this acquisition will propel its standing in the market further. It will also help it serve clients across Europe more comprehensively.

As a result of this announcement and the prospective benefits to TCS, shares of TCS touched an intraday high of Rs 1512 per share, up by over 2%. The deal is expected to be completed by the end of this quarter.