The route of acquisitions has been a key strategy of Indian software majors to rapidly develop marketing presence and domain knowledge in key geographies and underserved verticals. What began tentatively around the year 2000 has now become a regular feature for these companies. Majority of these acquisitions have been focused on developing the front ending and consulting capabilities of Indian companies. Part of this strategy is also to get the back-end of the target companies to relocate to India so as to reduce costs.

In the longer term, these acquisitions would further globalize the operations of the companies and help them truly become local companies in their geographies where they operate. Investors also welcome such acquisitions as they make productive use of the large idle cash reserves that most of the companies carry in their books. As the IT services sector mature, investors would also look deeper into the transactions to see how the synergies operate, and also see whether the company is able to integrate not only the legal entities, but also the people and processes behind them.

Bangalore-based Wipro has been among the most aggressive acquirers from India in the recent past, and the last few months have seen a flurry of activities in this area. We believe that in the medium term, the organic growth strategy would also help Wipro to develop into a more nimble organization, and become more competitive in the marketing areas, which was, sometimes back, considered a weakness for the company.

Wipro Tech is an information technology service company established in India in 1980. It is the global IT services arm of Wipro. It is headquartered in Bangalore and its employee strength was more than 70,000 till September 2007.

Wipro Technologies has over 300 customers across the US, Europe, and Japan including fifty of the Fortune 500 companies. Some of its customers are Boeing, BP, Cisco, Ericsson, IBM, Microsoft, Prudential, Seagate, Sony, Windriver, and Toshiba. It has dedicated development centers and offices across India, Europe, North America, Latin America, and Asia Pacific.

The current chairman, managing director, and majority stake owner is Azim Premji, who has headed the software and hardware divisions since Wipros inception. Premji completed bachelors degree in electrical engineering. The Indian Institute of Technology, Roorkee, and the Manipal Academy of Higher Education have both conferred honorary doctorates on him, while XLRI, Jamshedpur has conferred the Sir Jehangir Ghandy Medal for Industrial and Social Peace. Premji is also a non-executive director on the board of RBI. The equity of the company currently stands at Rs 291.8 crore, wherein promoters hold 81.44%, institutional investors hold 6.23%, Indian public holds 7.93%, and private corporate bodies and others hold the balance 4.4%.

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