India’s second largest outsourcer, Infosys Technologies, is considering a bid for French IT services company Capgemini, according to a report in the Times of India newspaper.
Infosys declined to comment on the reports. “We do not comment on market rumours,” a spokeswoman for the company said Friday. However, Infosys, in Bangalore, indicated at its analyst conference in April that it may consider an acquisition.
An acquisition deal between Infosys and Capgemini is unlikely to happen, said Siddharth Pai, a partner at consultancy firm Technology Partners International. Infosys might acquire Capgemini to get access to European markets, where it doesn't have a large presence, but the cultural incompatibilities between the two companies are high, he added
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 way to win new business and add staff in India.
Last year, the company acquired a 51% stake in Unilever India Shared Services, a subsidiary of European consumer goods maker Unilever Group, which will become a wholly owned subsidiary of Capgemini by 2008.
In February, Capgemini acquired Kanbay International a US-based IT services firm, to boost its services delivery from India, and its business in the financial services sector.
Infosys reported revenue of £1.55bn for the financial year ending 31 March, and has forecast revenue of about £2bn in its current financial year.