CEO Ravi Kumar S said acquiring Belcan will strengthen Cognizant’s position in the fast-growing engineering research and development services market.
Global IT giant Cognizant Technologies plans to acquire digital engineering firm Belcan for $1.3bn in a cash and stock deal.
In an announcement today (10 June), the New Jersey-headquartered company said the Belcan acquisition will significantly expand its engineering research and development (ER&D) capabilities, particularly in the areas of internet of things (IoT) and digital engineering.
Cognizant, which was founded in India more than 30 years ago, is a multinational IT services and consulting company listed on the Nasdaq. It posted a revenue of nearly $20bn last year and employs nearly 350,000 people around the world.
Now, it hopes that buying Belcan will help it scale and establish its dominance in the high-growth aerospace and defence industry, equipped with more than 6,500 engineers and technical consultants. Following the deal’s close, Cognizant expects revenue contribution from the acquisition to surpass $800m annually.
“We believe that acquiring Belcan will strengthen Cognizant’s position in the sizable and fast-growing ER&D services market,” said CEO Ravi Kumar S.
“Belcan’s deep engineering capabilities and domain expertise across the aerospace & defense market will be complemented by Cognizant’s scale and own multi-decade digital engineering expertise, providing Belcan’s blue-chip client roster access to our advanced AI, cloud and data technologies.”
He added that the acquisition will ensure Belcan clients gain access to a full suite of Cognizant tech services across the manufacturing, automotive, energy and high-tech sectors – while Cognizant’s clients across these sectors will benefit from Belcan’s engineering skills.
“Cognizant will better position our team to capitalise on compelling tailwinds, including increasing outsourced ER&D spend, the transformative impact of digital engineering adoption rates, robust commercial aerospace demand and favourable long-term defence and space spending,” said Belcan CEO Lance Kwasniewski, who is expected to continue to lead the business unit.
In 2019, Cognizant made two notable acquisitions as it expanded into Ireland. The multinational acquired Meritsoft in March that year, which is a Dublin-based financial services software company. It also acquired Zenith Technologies, a Cork-based life sciences tech company that was founded by businessman Brendan O’Regan.
Last year, the company announced plans to create 320 jobs primarily at its life sciences division in Ireland over a three-year period.
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