In a recent development, IT firm HCLTech announced its acquisition of certain assets from Hewlett Packard Enterprise’s Communications Technology Group (CTG) for $225 million, equivalent to around Rs 1,874 crore, in an all-cash deal. This agreement will involve the transfer of approximately 1,500 employees and 700 contractors with expertise in engineering services for the telecommunications industry across various countries including Spain, Italy, India, Japan, China, America, and the APAC region to HCLTech.
According to a regulatory filing by HCLTech, the acquisition is focused on the purchase of certain assets (CSS) of the Communications Technology Group, a business division of Hewlett Packard Enterprise Company. This division provides engineering services to leading communications service providers (CSPs) worldwide, leveraging its intellectual properties in a global delivery model. The deal aims to enhance HCL Technologies’ presence in the telecom sector by expanding its engineering services and utilizing CSS’ intellectual property, solutions, and talent at leading CSPs in Europe, Japan, Americas, and the APAC region, including 20 of the top 30 CSPs globally.
HCLTech’s CEO and Managing Director, C Vijayakumar, expressed optimism about the transaction and the strategic partnership with HPE, emphasizing the strengthening of the company’s telecommunications practice to cater to the evolving global market. He highlighted the valuable addition of top engineering talent and industry-leading intellectual property from the CTG Group of HPE, which will enhance HCLTech’s capabilities and partnerships with global CSPs. The transaction is currently pending regulatory approvals and other closing conditions, with an anticipated completion timeline of six to nine months.
Hewlett Packard Enterprise President and CEO, Antonio Neri, welcomed the acquisition, stating that the Communications Technology Group will benefit from becoming a part of HCLTech, a strong partner that recognizes the importance of CTG’s legacy, strategy, and future potential.
Overall, this strategic acquisition by HCLTech represents a significant step towards bolstering its presence and capabilities in the telecom sector, with a focus on expanding engineering services and leveraging intellectual property to cater to the evolving needs of global CSPs. The partnership with HPE is expected to enhance HCLTech’s position in the market and drive growth in the telecommunications industry.
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