Cognizant to acquire marketRx for $ 135 mn
Chennai/Bangalore,
Oct
21:
Cognizant
Technology
Solutions,
an
IT
and
BPO
services
company,
is
said
to
acquire
marketRx,
a
New
Jersey-based
firm.
Congnizant
will
pay
$135
million
in
cash
to
acquire
marketRx,
a
provider
of
analytics
and
related
software
services
to
life
sciences
companies.
It"s the biggest acquisition made by Cognizant so far, and among the biggest in high-end business process outsourcing space recently. In a deal structured on Thursday night, Cognizant is believed to have pipped IT services giant Infosys Technologies in bagging the deal.
This is the second high-profile deal-making in the KPO space, after WNS snapped up Bangalore headquartered Marketics for $65 million earlier this year. Sources said while Infosys" valuation of the marketRx was higher, Cognizant offered upfront cash pay out. It is believed that Infy"s offer had a substantial chunk of earnings payout, which essentially means a combination of upfront money and the remaining to be based on future performance.
The Nasdaq-listed Cognizant with predominant operations in India said the acquisition would help strengthen its analytics unit and offer more services to life sciences industry. The deal is expected to close in fourth quarter of 2007, and would be funded from its cash reserves. marketRx with per employee revenue of about $100,000 is projected to report revenues of over $40 million in 2007. It has 430 people, with 260 in Gurgaon, 160 in the US (four locations), and 10 in London.
Cognizant is expected to cross 55,000 people by end of this year and with revenue guidance of $2.11 billion in 2007. It"s manpower addition this year is expected to be over 16,000, 40 times the strength of marketRx. Cognizant president R Chandrasekaran said, “It is a 'tuck-under" acquisition that is consistent with our acquisition strategy of selectively acquiring businesses that complement or enhance our business model and value to our customers.
Cognizant president and CEO Francisco D"Souza said, “This acquisition expands our capabilities in the analytics segment and broadens our service offerings for the life sciences industry while providing strong synergies with our existing business intelligence/data warehousing and CRM (customer relationship management) services."
marketRx has a proven global delivery model for analytics, deep domain knowledge and proprietary analytics software platform, he said. “We expect to leverage these assets to establish a pre-eminent position in the fast-growing analytics market both in life sciences and other industries," Mr D"Souza said in a statement.
marketRx
president&CEO
Jaswinder
(Jassi)
Chadha
said,
“The
combination
of
our
market
leading
position
in
the
life
sciences
analytics
segment
and
Cognizant"s
strengths
as
a
top
global
services
player
will
allow
us
to
expand
our
relationships
with
our
life
sciences
clients
by
providing
them
with
a
broader
range
of
outsourced
services,
and
conversely
enables
us
to
extend
our
capabilities
to
other
vertical
markets." OneIndia
News
>