Infosys Chief Financial Officer V. Balakrishnan spoke to Business Line on the acquisition.
This acquisition means…
It fills some of the gaps in our consulting and system integration portfolio. Firstly, this acquisition gives us a footprint into consulting. Also, gives access to domains like life sciences and automotive sectors in Europe. It takes a lot of conviction to do a strategic deal when a whole continent is in turmoil. Also, this comes at a time when there is shrinking discretionary spending in Europe. However, market for quality projects still there. This opens up Europe in a big way for us.
On Europe
You have to understand that Europe is changing. There is an increasing push towards efficiency and in an unwitting manner, the crisis has accelerated the need to be efficient as compared to previous times.
In most of the domestic economies there, cost saving is increasingly being talked about and offshoring and outsourcing and this is a strategic play by us to invest in an area which is in turmoil but could yield us revenues in the future.
On building consulting capabilities through acquisitions
When we started out our consulting journey in 2002, we preferred to grow our team organically. But during our journey, we realised that the mindset for consulting is different and hence we decided to embark on the acquisition route. This does not mean that we won’t grow our consulting capabilities internally. If you see, in the area of SAP software implementation alone, we have around 9,000 consultants. At the heart of it is a simple rule. In consulting, you get pull through revenues. For example, for every dollar of consulting revenues we earn, we can get $2-3 of additional revenues.
More acquisitions?
We have a considerable appetite for buying companies that will fit into our strategic needs. Beyond acquisitions, internally there are a lot of steps that we will take in our journey to continue achieving high-quality revenue growth.