Danske Bank’s Indian IT centre that was recently acquired by IT giant Infosys was valued at $9.2 million (Rs 77 crore), Infosys revealed in a filing with the US Securities and Exchange Commission (SEC).
Infosys in June inked $454mn (Rs 3,780 Cr) digital transformational deal with Nordic based Danske Bank and acquired its IT centre in India. The company also acquired Danske Bank’s IT centre in India, where more than 1,400 professionals are employed.
Infosys stated, “On September 1, 2023, Infosys entered into a share purchase agreement to acquire 100% of the voting interests in Danske IT and Support Services India Private Limited, which is Danske Bank’s IT center in India. The estimated consideration is approximately DKK 63 million (approximately Rs 77 crore), which may be subjected to a further adjustment on finalization of the opening net assets value as agreed in the Share Purchase Agreement.”
The Danske bank deal is valid for five years and can be renewed for one additional year for a maximum of three times.
Analysts say Danske Bank started outsourcing to India in 2004. Eleven years later, in 2015, it shifted its strategy to in-sourcing. Now again after eight years, Danske Bank has pivoted to outsourcing.
The Infosys – Danske Bank deal was one of the rebadging deals that IT companies bagged recently. Rebadging involves the transfer of employees from clients to IT vendors and many times are part of the deals that IT companies bag from clients.
Analysts say that such multi-year, rebadging deals are likely to be margin dilutive in the first few years because of upfront investments made by IT companies at the start of the deal. But they also expect that in the longer term, the IT firms will manage margins reasonably well.
