MUMBAI: When the $250-million iGate was bidding for Patni Computer Systems , its closest competitor was not another Indian IT player but private equity firm Carlyle. Indian IT majors have not pursued acquisitions of local peers vigorously, preferring instead to look overseas for large deals. And this despite the fact that local buyouts offer some definite advantages.
But Patni, with $700 million in revenues and 15,000 employees, could have been a good acquisition for many Indian IT firms, including some of the big names.
For Wipro, which acquired Spectramind several years ago, buying Patni would have helped narrow the gap between itself and Cognizant. Patni and Wipro also share common clients such as GE and have synergies in product engineering services.
Cognizant has been swiftly narrowing the gap with Wipro in the June 2010 quarter the difference between their revenues was barely $99 million which in the September 2010 quarter had dropped to $56 million and is set to take the crown of Indias third largest software exporter.
For the $7-billion plus TCS , an additional 10% business would not have made much difference. I also think high profitability fixated Infosys would not look at Patni more as a cultural and policy issue. But combination of Patni with Wipro or HCL could throw up some interesting data points. And interestingly, the integrated Mahindra group (Mahindra Satyam plus Tech Mahindra plus Patni) actually could have given a tough fight to Wipro, which is already working hard to retain the coveted third place, says Sudin Apte, principal analyst and CEO of technology research firm, Offshore Insights.
For both HCL Technologies and Mahindra Satyam-Tech Mahindra, Patnis application development and maintenance (ADM) business would have ! compleme nted existing service lines. Infrastructure management services is HCLs strongest service line while application development and maintenance form only for 25% of revenues against the industry average of 50%.
Similarly, while Mahindra Satyam is strong in enterprise services and Tech Mahindra in telecom-related IT solutions, both do not have a strong application maintenance business. Patnis $ 440-million ADM revenue and $600 million North America revenue would have made Mahindra more balanced compared to its current skew towards Europe, says Apte.
But Patni, with $700 million in revenues and 15,000 employees, could have been a good acquisition for many Indian IT firms, including some of the big names.
For Wipro, which acquired Spectramind several years ago, buying Patni would have helped narrow the gap between itself and Cognizant. Patni and Wipro also share common clients such as GE and have synergies in product engineering services.
Cognizant has been swiftly narrowing the gap with Wipro in the June 2010 quarter the difference between their revenues was barely $99 million which in the September 2010 quarter had dropped to $56 million and is set to take the crown of Indias third largest software exporter.
For the $7-billion plus TCS , an additional 10% business would not have made much difference. I also think high profitability fixated Infosys would not look at Patni more as a cultural and policy issue. But combination of Patni with Wipro or HCL could throw up some interesting data points. And interestingly, the integrated Mahindra group (Mahindra Satyam plus Tech Mahindra plus Patni) actually could have given a tough fight to Wipro, which is already working hard to retain the coveted third place, says Sudin Apte, principal analyst and CEO of technology research firm, Offshore Insights.
For both HCL Technologies and Mahindra Satyam-Tech Mahindra, Patnis application development and maintenance (ADM) business would have ! compleme nted existing service lines. Infrastructure management services is HCLs strongest service line while application development and maintenance form only for 25% of revenues against the industry average of 50%.
Similarly, while Mahindra Satyam is strong in enterprise services and Tech Mahindra in telecom-related IT solutions, both do not have a strong application maintenance business. Patnis $ 440-million ADM revenue and $600 million North America revenue would have made Mahindra more balanced compared to its current skew towards Europe, says Apte.
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