Wipro share price gained as much as 1.6 per cent in the morning trade on Thursday after the IT major announced that it has signed an agreement with Landesbank Baden-Wuerttemberg (LBBW) to acquire Cellent AG for 73.5 million Euros.
Wipro share price gained as much as 1.6 per cent in the morning trade on Thursday after the IT major announced that it has signed an agreement with Landesbank Baden-Wuerttemberg (LBBW) to acquire Cellent AG for 73.5 million Euros. Cellent AG is a leading IT consulting and software services company and has been offering holistic innovative IT solutions and services to its customers in the DACH region of Germany, Austria and Switzerland for the past 14 years.
At 10.53 am, Wipro shares were trading marginally up 0.08 per cent at Rs 578.20. The scrip opened at Rs 587 and had touched a high and low of Rs 587 and Rs 576.15, respectively, in trade so far. Sensex was down 145.95 points, or 0.56 per cent, at 25,971.90. Later, the share price of the company closed 0.97 per cent down at Rs 572.15.
The acquisition will provide Wipro with significant scale in the DACH region (Germany, Austria and Switzerland) and prime customer relationships, especially in the manufacturing and automotive domains, which are key industry sectors in the DACH region.
Sarabjit Kour Nangra, vice-president research, IT, Angel Broking, said, “Cellent AG serves the DACH market region with a team of more than 800 consultants, who will now become part of Wipro. The company had sales of 87 million Euros. Though the profitability of the acquired business is not available, we believe that the acquisition doesn’t look prima facie an expensive acquisition and should be EPS accretive. The funding should not be a problem, as the company has significant resources. Our rough estimates suggest that the acquisition can increase by 0.6 per cent for full year EPS. We maintain our ‘Buy’ rating with a price target of Rs 719.
The promoters holding in the company stood at 73.36 per cent while institutions and non-institutions held 15.29 per cent and 9.38 per cent, respectively.
The BSE group ‘A’ stock of face value Rs 2 has touched a 52 week high of Rs 676.90 on 11-Mar-2015 and a 52 week low of Rs 512.55 on 24-Apr-2015.
Last one week high and low of the scrip stood at Rs 587 and Rs 565.20 respectively. The current market capitalisation of the company is Rs 1,43,460.33 crore.