Cognizant tipped to become third largest Indian IT player, acquires CoreLogic
By Vishwanath Patil,
Cognizant Technology Solutions or CTS will acquire the India unit of analytics and business services firm CoreLogic for $ 50 million, adding 4,000 people to its 10th acquisition in six years, as it gears to replace Wipro as the third largest IT service provider in the country.
Cognizant, with headquarters in US, follows the offshore business model, similar to rivals such as Infosys Technologies and Tata Consultancy Services, of having majority of its workforce in low cost countries like India. Cognizant has grown its business faster than its peers such as Infosys and Wipro in the last three years, a period when the world economy shrunk and clients cut budgets. In the last three quarters, both Wipro and Infosys have seen changes in its top leadership as well as business strategies for the future.
Cognizant has projected a second quarter revenue of $ 1.45 billion and is expected to announce its second quarter results on August 2nd. In the April-June quarter, revenue of Cognizant, headed by 43-year old Francisco D’Souza, surpassed that of Wipro by $ 40 million. Last week, Wipro posted a less than expected first quarter results by reporting profit of Rs 1335 crore on a revenue of Rs 8564 crore or $ 1.408 billion.
In the past, Cognizant has adopted similar models of acquiring local units of US companies such as UBS and offer them services on long term contracts. (See Infographic on Cognizant’s acquisitions since 2005).
With the acquisition of the India team at CoreLogic, Cognizant would be able to offer real estate information and analytics to US clients. CoreLogic has built among the largest and most comprehensive U.S. real estate, mortgage application, fraud, and loan performance databases with public, contributory, and proprietary data covering approximately 99 percent of U.S. residential real estate property records, 80 percent of mortgage applications, and 85 per cent of mortgage loan servicing performance information.
CoreLogic will also use Cognizant as a service provider, committing revenues of $ 324 million in the next five years. “Their (CoreLogic) dedicated capabilities in domain-centric back-office services, software product development, and analytical modelling, combined with Cognizant’s domain-aligned technology and business process expertise, will create greater value for our mutual financial services clients and enable the delivery of sophisticated analytics and next-generation business process solutions to market,” said Francisco D’Souza, President and CEO of Cognizant.
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