Capgemini plans €500 million digital acquisition spree

13 March 2018 4 min. read

As the digital market becomes increasingly competitive, global consultancy Capgemini is planning to swoop in with a series of acquisitions, cumulatively valued at €500 million. The plans come on the back of the acquisition of digital offerings firm LiquidHub. 

Over the last few years, India has come to check all the boxes of being a market remarkably suited for investment in the digital space, particularly for consulting firms who assist with transition to the digital sphere. The cloud market, which has proved a ripe segment for the consulting industry, is currently thriving in India, as is the online consumption segment.

By 2025, India will be a market of 850 million internet-users, and consulting firms are lining up for a piece of the pie. Indian firms have been quick to consolidate their presence, having been on extravagant acquisition drives in the digital space. International firms have recognised the opportunity as well, and have been rapidly launching their digital offerings in India.

Over the last year, global consultancy Grant Thornton established a digital practice in the country, followed by the establishment of Deloitte Digital in India; the technological arm of Big Four professional services firm Deloitte. In terms of specific offerings, the cloud space has been the most popular area of investment.

Capgemini plans €500 million digital acquisition spree in India

Big Four professional services firm EY, for instance, launched a cloud platform by the name of Catalyst in India late last year, as did Big Four rival PwC by the name of Neomegha. Global information giant Google also launched a cloud consulting business in India last year, which was followed by global IT firm IBM acquiring a local cloud software firm by the name of Sanovi Technologies.

It comes as no surprise, therefore, that the Indian market features on the list of global markets into which consultancy Capgemini hopes to expand in months to come. Globally, the Paris-based firm appears to be on an expansion drive, having earmarked €500 million for around 10 acquisitions, which will consolidate its presence in the international digital market. 

The target-firms, spread across global markets, are small to medium sized, preferably with expertise in the digital and analytical domains. Capgemini employs nearly 200,000 staff worldwide and generates revenues of over EUR 12.8 billion annually. Over the next few months, the firm plans to bolster its operations in the global digital arena, which includes the Indian market.

Capgemini already has a substantial presence in India, particularly since 2015, when the firm acquired IT services firm IGATE, which is comprised, for a large part, of the former Indian software firm Patni Computer Systems.

Earlier this year, Capgemini acquired global innovative technology firm LiquidHub. Among its extensive global operations, LiquidHub also offers a foothold in India, which is home to 1,500 of the firm's 2,500 employees worldwide. 

Having acquired LiquidHub, Chairman of Capgemini, Paul Hermelin had said, “you should be careful where you put it, how you dock it. LiquidHub is the terminal and we can dock small helicopters (companies) and there will be around ten comparatively smaller companies.” He then provided insight into the firm’s plans for the future in the global market, saying, “we told the market that we will deliver more than €1billion of free cash flow. Out of that, €500 million will be spent on acquisitions."