KPIT Cummins Infosystems Ltd, a Pune-based IT consulting firm, has entered into a merger agreement with Sparta Consulting for $38 million (Rs 180 crore) in an all cash deal. Sparta is a US-based firm providing high-end SAP solutions for enterprises, and has a strong presence in North America.
The company believes the merger will help KPIT to offer greater efficiencies and strengthen market presence with accelerated growth, it said, in a statement. “The merger with Sparta Consulting further strengthen KPIT’s business model to focus on select industries and achieve market leadership by creating best in class practices,” the company added.
Kishor Patil, MD & CEO, KPIT Cummins, said, with the rapidly scaling up of ERP consulting business, the company sees large market opportunity in the space. “Sparta team has created a SAP services business, which has grown nearly 300% year-on-year, apart from creating another enterprise business worth $250 million. We look forward to work jointly to help customers achieve their post-downturn growth objectives,” said Patil.
KPIT has been quite active on the M&A front acquiring five companies so far. Recently, the company has informed that it is looking for acquisition opportunities in the US.
In 2003, it acquired US-based Panex Consulting Inc, a SAP implementation services firm in business intelligence & data warehousing space, followed by the acquisition of SolvCentral.com in 2005. It also acquired Pivolis.com, a French outsourcing consultancy firm in 2005; CG Smith Software Pvt Ltd, an automotive electronics software & solutions company in 2006; and the mechanical design services business of Harita TVS Technologies in 2008.
Net sales and net profit of the company in fiscal 2008-09 were Rs 793.15 crore and Rs 65.81 crore respectively.