India’s fourth largest IT services firm HCL Technologies seems to be on an acquisition spree. The Noida, India-based firm has now purchased Minneapolis-based CRM service provider PowerObjects for $46 million.
Under the deal, HCL Tech will absorb as many as 250 employees of PowerObjects, which has reportedly made more than $37 million in revenue since January this year.
This is the fourth acquisition for HCL Tech this year. In July, it acquired certain assets of Trygstad Technical Services, a US-based IT consulting services and solutions firm with expertise in areas of core engineering, Internet of Things, embedded systems and intelligent systems. Then it bought Bangalore-based engineering services firm Concept to Silicon Systems (C2SiS). Barely a week ago, it snapped up Swedish automaker Volvo Group’s external IT business.
The latest purchase will bolster HCL’s global applications business, a vertical that accounts of more than 40 percent of the Indian firm’s revenue.
HCL Tech’s stock price is falling of late after the company warned slowing growth. The IT firm earns nearly a quarter of its revenue from Europe. Decreasing value of currency in Europe, particularly in Britain, seems to have hurt its revenue growth.
HCL executives said the acquisition of PowerObjects will help the company cling on to its share in the global application services market and launch new services in social, mobility, analytics and cloud.
PowerObjects is a professional services firm completely focused on providing service, support, education and add-ons for Microsoft Dynamics CRM. The company has won Microsoft’s ‘Partner of the Year’ award three of the last four years, and is one of Microsoft’s leading partners for Dynamics CRM.
The Indian firm believes Microsoft Dynamics is one of the fastest growing CRM products in the market. At a growth rate of 13.3% in 2014, CRM will be a $36 billion worldwide market by 2017, according to Gartner. The acquisition might at least help HCL deepen its relationship with Microsoft.
“As companies look for new and more effective ways to engage their customers, technology plays an important role in enabling them to gain greater insights, become more responsive and create business value,” said Susan Hauser, corporate vice president, Enterprise and Partner Group, Microsoft. “HCL and PowerObjects are well positioned to help drive business transformation by helping companies intelligently engage with their customers.”
HCL is one of only eight 21st century global technology companies to cross US$1 billion in net profit. It has more than 1,500 employees in the United States alone, with offices in Cary, North Carolina; Redmond, Washington; Jackson, Michigan; and Rochester, New York.