Hexaware Technologies Buys U.S.-Based Mobiquity For $182 Million
It’s the largest acquisition for the IT company.
Hexaware Technologies Ltd. agreed to acquire U.S.-based Mobiquity Inc. for $182 million to expand its cloud and automation service offerings.
The deal—the largest by the Mumbai-based company—will help it gain traction in its banking and pharmaceutical verticals through Mobiquity’s digital products, according to its exchange filing today. “Mobiquity will bring direct and substantial value in cloud technology and transformation of customer experiences,” the company’s Chief Executive Officer R Srikrishna told BloombergQuint in an interaction.
As per the agreement, $131 million would be paid upfront while the remaining would be a deferred consideration—part of which is contingent on earnouts.
Revenue of the Mobiquity group—whose customers include Amazon Web Services Inc., Backbase Inc., Otsuka Holdings Co. Ltd., Rabobank International, Royal Philips NV and Wawa Inc.—was $70 million for the year ended December compared with $53 million in 2017 and $46 million in 2016, according to a statement accompanying the filing. The takeover, Srikrishna said, won’t dilute Hexaware’s operating margin as the target company, too, has a near-similar metric.
Indian information technology companies, battling rising wages and competition from their international peers, have been buying out companies around the world to boost growth and build capability in newer technologies like digital services. Tata Consultancy Services Ltd., India’s largest company by market value, acquired London-based design studio W12 for an undisclosed sum in November last year. Its peers Infosys Ltd. and Wipro Ltd. have bought at least two such companies each over the past year.
Shares of Hexaware rose as much as 3.6 percent to Rs 359.15 apiece in early trade today compared with the benchmark Nifty's 0.36 percent decline.