India's second biggest IT outsourcing company – Infosys – on Monday announced the acquisition of US-based Panaya for $200 million.
The New-Jersey based Panaya provides cloud-based quality management services for enterprise applications. Its clients include companies like – Coca-Cola, Mercedes-Benz and Unilever among others.
The acquisition being the second-largest for Infosys since its September 2012 deal to acquire Zurich-based Lodestone Holding is an all-cash deal. According to a statement by Infosys on Monday, this deal is expected to close before March 31, 2015.
In the statement, the company said, “Panaya's acquisition reflects Infosys' execution of its Renew and New strategy to enhance the competitiveness and productivity of current service lines by leveraging automation, innovation and artificial intelligence.”
The IT major, under its chief Vishal Sikka, is currently, betting on new technology to boost growth. It is making big bets on automation and other new technology like artificial intelligence and cloud-based services in order to beat its close rival Tata Consultancy Services.
Infosys, which had a cash pile of Rs 32,000 crore at the end of December 31, 2014, has often been criticized by analysts for being conservative with respect to acquisitions.
Globally, it is known that companies use cash to either grow inorganically i.e. through acquisitions or they return it to shareholders.
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