Tata Consultancy Services, India’s largest software services company, will acquire Pramerica Technology Services, a unit of insurance giant Prudential Financial Inc, according to media reports.
The company will reportedly take over certain assets of this Ireland-based tech-services firm and onboard its 1,500 employees, but no cash will change hands. Prudential is looking to reduce its non-core operations to cut costs amid the Covid-19 fallout. Both companies have declined to comment.
For Tata Consultancy Services, the Pramerica deal will bring in a development center in Ireland and help expand its business of providing multi-functional, digital services and solutions in Ireland, the UK, Europe and the US. The Indian company will continue to service Prudential under a multiyear service arrangement.
Tata Consultancy Services‘ president (banking, financial services and insurance), K Krithivasan, said, “We warmly welcome Pramerica’s employees into the TCS family. We are confident they will avail the immense career growth opportunities that TCS offers, and fully realise their potential.”
Prudential Financial said it will retain the Pramerica Ireland entity, which will continue to operate from Letterkenny, and will focus on providing regional business services.
Banks and insurers are making efforts to shed non-core assets like tech support to deal with the economic uncertainty caused by the Covid-19 pandemic.
For Tata Consultancy Services this is the second such acquisition this month. Earlier Deutsche Bank agreed to sell its technology services unit Postbank Systems AG to the Indian tech giant for just one euro. The Tata firm acquired all its shares and 1,500 employees by the year-end.
A unit of salt-to-software conglomerate Tata Group, Tata Consultancy Services has a market value of more than $130 billion and more than 450,000 employees around the world. Its customers include Citigroup Inc, BT Group Plc, Panasonic Corp and Qantas Airways Ltd.
In the recent July-September quarter, the IT giant had recorded a profit of 74.75 billion rupees ($1.02 billion) and posted revenue of 401 billion rupees ($5.47 billion). The company has increased its focus on digital technologies as more firms shift towards cloud based services.