The Hindu Business Line : Strong euro impacts cost competitiveness

COGNIZANT Technology Solutions plans to close down its software development facility in Limerick, Ireland, over the course of next year on account of the euro's rise against the dollar in the last two years.

The euro had risen 35 per cent against the dollar since the Limerick plant was acquired in 2002, which had "substantially increased" costs, said a company official.

The Ireland facility provides software development and maintenance services to Cognizant's clients in North America.

About 50 employees will be affected following the closure. Cognizant will provide severance packages and outplacement services for all affected employees. Further, all work efforts will be transferred from the facility to Cognizant's operations in North America and India, said a company official.

"We are disappointed that circumstances, in particular euro appreciation, have forced this action. Cognizant, nonetheless, remains committed to expanding its delivery capabilities in regions of the world that offer superior and plentiful talent at a competitive cost to serve our clients throughout North America, Europe and Asia," said Mr Francisco D'Souza, Chief Operating Officer, Cognizant, said in a statement.

Ireland was Cognizant's first near-shore software development.

As part of the company's strategy in Europe in 2002, Cognizant also then purchased certain assets from UnitedHealthcare Ireland Ltd (UHCI), a subsidiary of UnitedHealth Group.