India’s second-largest IT services firm Infosys Technologies on Wednesday said its Australasian subsidiary has acquired the software solutions business of Gen-i, the ICT arm of Telecom New Zealand. The company did not disclose the value of the deal, but analysts estimate it to be in the range of $4-$6 million considering the business size and revenue run rate of the company.
As part of the deal, Infosys will induct 110 employees and contractors of Gen-i who will continue to be based in Auckland, Wellington and Christchurch. With this addition, Infosys? New Zealand operation will have over 150 people. The IT major also has immediate plans to hire an additional 15-30 people.
According to Infosys, the partnership will create new market proposition for local businesses seeking capabilities in IT services, including consulting, business transformation and cloud-based offerings. ?Since launching our first New Zealand office 18 months ago, we have been studying the market to find the right strategic partner. Our partnership with Gen-i makes sense because we share core values and complement each other?s strengths to fill some critical gaps in the marketplace,? said Jackie Korhonen, chief executive, Infosys Australia and New Zealand.
However, analysts feel the acquisition won’t be of much help to Infosys. ?Its a very small deal. I don?t see any material impact of this in terms of earnings. It is just a geographical ramp up since Infosys don?t have a big presence in New Zealand. And now with the protectionist measures on rise across countries this is just a way of increasing the local headcount,? said Sanjeev Hota of Sharekhan.