Latest Expert Exchange Queries

GST Demo Service software link:
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Popular Search: VAT Audit :: form 3cd :: ACCOUNTING STANDARD :: TDS :: ACCOUNTING STANDARDS :: VAT RATES :: due date for vat payment :: cpt :: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: articles on VAT and GST in India :: empanelment :: TAX RATES - GOODS TAXABLE @ 4% :: ARTICLES ON INPUT TAX CREDIT IN VAT :: Central Excise rule to resale the machines to a new company
Mergers and Acquisitions »
 Deals of the day-Mergers and acquisitions Jan 16, 2018
 Mergers & Acquisitions is accepting nominations for our 10th annual M&A Mid-Market Awards
 Why 2018 could be the year of Mergers & Acquisitions
 15 of the Best Mergers & Acquisitions of 2017
 How recent valuations have affected M&A deals
 India Inc made merger and acquisition deals worth over $60 bn in 2017
 Global appetite for mergers and acquisitions sparked by stock market rally in 2017
 2018 may see mergers and acquisitions worth $50 bn on back of stressed assets: Report
 10 Major Security Mergers and Acquisitions From 2017
 5 Massive Mergers And Acquisitions Which Reshaped Indian Businesses In 2017
 The 9 High Profile Indian Startup Acquisitions Of 2017

CSC, HP services merge to create IT powerhouse
May, 27th 2016

The merger between HP Enterprises' (HPE) services business and Nasdaq-listed Computer Sciences Corporation (CSC) will create a pure-play IT services powerhouse with outsourcing revenues higher than that of Accenture's (sans its consulting business) and one that will be better positioned to compete against the formidable Indian IT companies.

The new entity is expected to have $26 billion in combined revenues that includes CSC's $8 billion and HP Enterprise's $18 billion services business. And over 40% of the workforce of the combined entity will be based out of India - that's about 55,000 employees, including HP India's 30,000 and CSC India's 25,000).

Peter Bendor-Samuel, CEO of US-based Everest Research, said the merger makes sense for both sides, allowing HP to exit a shrinking and troubled space while allowing CSC to build scale and wring profits from the same space. "In the meantime, HP/CSC must overcome the distractions of the merger and carefully manage the impact of its customers, potentially further advantaging the Indian firms as they seek to continue to take share away from both firms," he said.

Indian IT services companies have been steadily taking share away from their global counterparts, thanks to their significantly better cost structure, made possible by use of large numbers of fresh college graduates, a better offshore-onsite mix of employees, and the use of a shared services model under which it uses the same resources for multiple clients. Most of the leading Indian IT firms have operating margins between 20% and 25%, while global firms' margins are well below 20%, with some European ones having margins of under 10%. Analysts say that the new CSC-HP entity will have the scale, resources and focus necessary to move closer to this model and combine that with its own traditional strengths to challenge the Indian IT majors.

Dell did something very similar in March, when it sold its IT services business to Japanese IT major NTT Data for $3.05 billion. This combined entity globally has over 1 lakh professionals, with about a third of them in India.

Latest Comment

It is sad that youngsters coming out from such premier institutions are looking for jobs. An IIM graduate is expected to start a venture and MANAGE, not work under someone. Why can''t they start a ne... Read More

For CSC, the architect of the deal is Mike Lawrie, the chairman, president and CEO who has dramatically turned around CSC since he took over in 2012. That's clearly giving a lot of confidence to investors, reflected in the sharp increase in the CSC share price following the deal. Lawrie has made a series of acquisitions and built partnerships with companies including Amazon Web Services, AT&T, SAP, Workday and HCL Technologies to go-to-market in the shortest possible time instead of building capabilities ground up. "He even created a two-in-a-box approach, marrying engineering and business personnel, that has really helped," said an industry executive who did not want to be named.

But some analysts are cautious. "HP, to put it mildly, has bungled previous attempts at amalgamating large acquisitions such as the EDS integration which resulted in lost customers and talent, and wiped out a large chunk of business that almost collapsed the services business," said Hansa Iyengar, IT analyst in London-based Ovum Research. "There is also bound to be a lot of confusion and scepticism in the market that the new entity will have to address by putting out a consistent message around its positioning, value-add, and strategy."

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Our Experience

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions