Wipro to acquire German IT service Cellent AG for Rs. 520 crores

Wipro Ltd. the country's third largest software services firm informed the exchange that it will acquire German firm Cellent AG. It is an IT consulting firm. The acquisition is worth EUR 73.5 million around Rs.520 crores.

Cellent AG is a fully owned subsidiary of Landesbank Baden-Wuerttemberg a provider of banking and financial services. Wipro signed an agreement with Landesbank Baden-Wuerttemberg for the  acquisition. The shares are being acquired through Wipro's subsidiary Wipro Cyprus. This an all cash deal which is expected to be closed in March 2016.

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 domain which are key industry sectors in the DACH region. It has offices in Germany (eight), Austria (two) and Switzerland (one). The DACH market is a strategic growth and investment region of Wipro. Cellent AG had reported revenue of EUR 87 million.

This is the second acquisition of the Bengaluru based company in the region this year. It bought Denmark-based Designit for $95 million in July to strengthen its presence in the digital space.

In terms of financials the total operating revenue of Wipro on year ending March 2015 stands at Rs.46951 crores an increase of 8.12 percent on yearly basis. The EBITDA of the company stands at Rs. 10299.2 crores an increase of 6.89 percent and the EBITDA margin is  21.94 percent as compared to 22.19 percent for same period last year. The net profit of the company stands at Rs.8660.9 crores an increase of 9 percent on yearly basis.

The stock of the company is trading at Rs.578.45 an increase of 0.12 percent from the previous close.

Wipro is a global information technology (IT) services provider. The Company operates through two segments: IT Services and IT Products. The Company's IT Services business provides a range of IT and IT-enabled services, which include IT consulting, custom application design, development, re-engineering and maintenance, systems integration, package implementation, global infrastructure services, business process services, research and development and hardware and software design to the enterprises worldwide.