Atos Acquires Syntel to Fortify North American Financial Business
Atos, the French IT services giant, has acquired India-based software provider Syntel for $3.57 billion. Syntel specialises in software solutions and has two major US financial services clients - Amex and State Street - a factor which analysts believe was a key driver for the deal. Atos sad it has been considering the acquisition of Syntel "a few years" and the deal will boost its to around EUR12.7 billion, it said.
The acquisition, pending regulatory approval, will be a major boost to Atos’ presence in North America, particularly in the banking and financial services sector, where Syntel conducts 43% of its business. In 2017, Syntel generated 89% of its total revenue ($823 million) in the region, with a focus on its application services. This alone makes Syntel an attractive acquisition for Atos, analysts say, which has been handicapped by an under-developed platform the US and Canada.
Purely in terms of capacity, Syntel, with its campuses in Mumbai, Chennai, Pune and Gurugram and 18,000-strong personnel, will provide a boost to Atos’ implementation and delivery.
However, considering the scale of both businesses, integration could prove challenging. Atos CEO Thierri Breton stated in an analyst call that the acquisition is expected to have a positive impact on the bottom line in 2019.