Mumbai: Indian IT services company Coforge has announced plans to acquire US based digital engineering and artificial intelligence firm Encora in a deal valued at about $2.35 billion. The transaction is one of the largest overseas acquisitions by an Indian mid tier technology company and signals Coforge’s strong push into AI driven services.
The acquisition will be carried out through an all stock transaction. Coforge will issue new shares to Encora’s shareholders, including global private equity investors. After the deal is completed, Encora’s existing investors are expected to hold close to one fifth of the combined company.
Coforge said the move is aimed at strengthening its capabilities in artificial intelligence, cloud computing, data engineering, and digital product development. Encora brings deep expertise in AI led software engineering and has a strong presence in the United States and Latin America, supported by a large pool of technology professionals.
The combined business is expected to generate close to $2 billion in annual revenue by the financial year 2027. Coforge has also indicated that the larger scale and expanded service offerings should support healthy margins over the medium term.
Following the announcement, Coforge shares moved higher, reflecting investor optimism about the company’s long term growth prospects. Analysts, however, noted that smooth integration and retention of skilled talent will be critical for the success of the deal.
Coforge said the acquisition is subject to regulatory approvals and is expected to be completed within the next few months. Once finalised, the deal is expected to significantly expand the company’s global footprint and improve its competitive position in the fast growing AI and digital services market.