Infosys may buy technology and back-office services arms of European companies

Indian software major Infosys is targeting to buy technology and back-office services arms of European companies.

Infosys could target business worth $40 million – $250 million over three to five years from these deals.

The strategy is to identify firms which are looking for outsourcing their technology and back-office services work to cut costs.

Such deals typically involve upfront payment for buying the facilities of corporations as well as taking over their employees, Times of India reported.

In 2007, Infosys acquired the finance and accounts processing centers of Royal Philips in Netherlands for $28 million and bagged technology contracts worth $250 million. As part of the transaction, Infosys had taken over around 1,400 employees across India, Thailand and Poland.

These kind of acquisitions are vital for Infosys to improve revenue streams and IT deals. ( Will Narayana Murthy deploy better performance measures to up productivity of Infosys? )

“There are quite a few opportunities we are participating in. For clients, it is about cost-optimization but at the same time they don’t want employees to be impacted,” said Infosys board member BG Srinivas, who also heads the financial services business division.

At present, Europe contributes 23 percent revenues to Infosys. Most of the European revenue comes from the United Kingdom and Nordic countries.

Infosys is not really aggressive about its acquisitions. It bought Switzerland-based Lodestone Consulting for around Rs 2,000 crore.

READ the original story Infosys’ European expansion plans HERE

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