Some major acquisitions activity, possibly presaging a trend towards consolidation, in the Indian offshore/outsourcing space. EDS has apparently just picked up a big chunk (in excess of 40%) of Mphasis:
The EDS-Mphasis deal is part of an ongoing trend that has software and BPO firms shifting large parts of their operations to India. IBM Global, in the last four years, has built its India base from scratch to 40,000 employees—more than a quarter of its estimated 150,000 US workforce. Accenture’s count of its India hands is at 20,000.
The rest among the industry leaders have lagged behind. EDS, Capgemini and Computer Sciences Corp. (CSC) had 3,000 to 5,000-strong offshore teams in India. “Apart from IBM and Accenture, all of them took their eyes off the ball,” says Ganesh Natarajan, deputy chairman and managing director at Zensar Technologies.
If the EDS buy of Mphasis goes through, it will grow its India presence nearly four times adding the target’s 11,000 workers in India and another 1,000 elsewhere to its rolls. “This helps our service delivery and brings in new software application development skills,” says an EDS spokesman In addition, having Mphasis in its stable will allow to bid for contracts less than $100 million, a size it has traditionally stayed away from.
Also posted at Knowledge Work.