HCL Technologies, one of India's largest IT services firms, has bought a 51% stake in the holding company of Deutsche Software, in order to boost its revenue from the financial services industry.
HCL didn't disclose how much it paid for the stake in the company, which is Deutsche BankÆs IT services subsidiary in India, but said it plans to buy the 49% balance in the next three years using its own stock.
Operating out of Bangalore since 1992, Deutsche Software, has over 450 employees who work in a range of areas from consulting to application development and maintenance. Under the terms of the agreement, Deutsche Software will have a right of first refusal for seven years on business that is to be sourced by Deutsche Bank from India. This, says HCL, should ensure a predictable flow of business and, at the same time, provide the company with flexibility to broaden and expand its client base by offering its services to other leading financial institutions.
"The joint venture is consistent with our strategy to smartsource software services through a competitive sourcing model," says Mitchel Lenson, chief information officer, corporate investment bank, Deutsche Bank." The partnership with HCL Technologies provides us with an opportunity to leverage our combined capabilities and resources to build a market leading software solutions company that will also help us reduce our technology services costs."
