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Cognizant acquires 6 companies of German IT firm C1 Group

BS Reporter/Chennai 22 Dec 12 | 01:19 AM

Cognizant Technology Solutions on Friday announced the acquisition of six companies of the C1 Group, a German information technology services and consulting firm. It did not disclose the value of the transaction, and said these acquisitions would help strengthen its presence in Germany and Switzerland.

The acquired companies are focused on three major industry segments — manufacturing and logistics, energy and utilities, and financial services. The transaction is expected to close in the first three months of 2013, subject to the successful completion of certain closing conditions and regulatory approvals, added the company announcement.

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The six companies are btconsult GmbH (process and technology consulting and SAP), C:1 Solutions GmbH (consulting and enterprise solutions on SAP, BPM, ECM and ERM); psc Management Consulting GmbH (process and technology consulting); C:1 SetCon GmbH (software engineering and testing); Enterprise Services AG, a Swiss company (process and IT consulting); and C:1 Holding GmbH.

Under the terms, 500 professionals in various locations in Germany and Switzerland are expected to join Cognizant.

"The strategic acquisition reiterates the company's commitment to the German and the larger European markets, and reinforces its position as one of the major IT services and consulting companies across the region", said Francisco D’Souza, chief executive, Cognizant.

These companies also bring expertise in enterprise application services (specifically SAP), and high-end testing services from test consulting, strategy and design to implementation, added the announcement.

Peter Schumacher, president & CEO, Value Leadership Group, said the move underscores the growing significance of the continental European market, in particular, Germany and Switzerland. "It reflects a very different strategy compared to Infosys's acquisition of Lodestone. While Lodestone is a focused "big-five style" company that provides SAP implementation and management consulting services mainly for large companies in pharmaceuticals and manufacturing, Cognizant is acquiring companies that provide a broad portfolio of technical, industry-domain, and operational consulting capabilities across a wide set of customers and sectors."

“While the acquisition is complex, Cognizant’s strong German delivery centre in India (formerly T-Systems, Pune) provides an inherent advantage. The acquisition is expected to help Cognizant penetrate, more successfully, the large number of German medium-size businesses, called Mittelstand." he added.

The merger of the C1 companies with Cognizant would support the latter’s growth strategy for Europe and create a bond with C1’s remaining companies, said Wilfried Förster, founder of the C1 Group. The move would enable the two companies to drive future diversification, and realise the strong growth potential of combined strengths, he said.

He added that international expansion was critical for parts of the group (C1 Group) to continue its growth, develop better solutions for current and future customers, and provide greater opportunities for its employees.

C1 Group has about 1,200 consultants and IT specialists across a range of industries and lines of service, from strategic consulting, process and systems integration and application development to 24x7 support.

Cognizant currently has a little over 50 delivery centres worldwide and around 150,400 employees as of September 30. The company has been looking at strategic acquisition for growth.

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