We did not lose a single client after deal announcement: Sunil Chitale

It is a buyout that caused significant excitement obviously among investors and employees, but also among clients and industry observers. It gave us a lot of ripe material for conversation: “Will clients leave? Will the top management change? Will a merger happen? Where will the final entity remain listed?”

Hence, Business Line catches up with one of the two-member team formed to lead the integration process between Patni and iGate. (iGate recently agreed to acquire the promoters stake in Patni in a deal valued over $1 billion.) Mr Sunil Chitale, Chief Strategy and Marketing Officer at Patni Computer Systems, and a Patni veteran of 26 years, explains why employees and customers need not have any apprehension over the coming together of these two parties. Edited excerpts

There was a lot of talk about how the deal between Patni and iGate would be detrimental to customers of both companies. How do you respond to such views?

Within half-an-hour of the transaction getting announced, we reached out to the top 200 customers of Patni and wrote to them explaining the contours of the deal and how it will be beneficial for them. We followed it up with customer calls and in-person meetings. I am sure that iGate also went through a similar exercise. I am happy to mention that customer see the transaction as a positive, synergistic one. At the end of the day what matters for clients is whether the teams servicing them continue to do so even after the transaction happens. Majority of the customers are complimentary and hence there is hardly any overlap.

In typical merger scenarios, people look at how they can reduce costs by taking headcount and facilities out. We do not have such issues since there are distinct and mutually exclusive sets of people servicing our customers.

I am glad to inform that not a single client left us after the deal announcement.

Employees of the company were also worried lot…How did you ensure that the correct message went out to them?

We took a multi-old approach. Firstly, five minutes before the rest of the world came to know, we told employees that the deal has been closed. We also created an online forum where people could ask questions anonymously without the fear of being identified. I personally answered some of the queries that were raised.

A merger like this sees attrition only when there is a risk of headcount reduction. In this case, the issue does not exist thanks to the complimentary client base.

Further, we did town halls with 100-150 people each. It helped to create a very strong connect with our customers. In fact, it was quite refreshing when one of our customers said: I understand how this transaction will be beneficial to both companies. If you want to convince your employees, I will do it on your behalf!

When are you at iGate and Patni merging into a single entity? Is 12-18 months a reasonable time period?

All options are there on the table currently. One of the two companies have to delist. Having two independent companies clearly will not benefit in the long run. If Patni has to delist then the process will take its own sweet time. If you look at the process of delisting in India, the entire process takes anywhere between 9-12 months. So it will take 12-18 months for the creation of a single entity.

However, we cannot wait for 18-24 months to pass on the benefits of this joint platform to the customer. Our immediate goal is to have a combined entity, from a go-to-market perspective, and bring the power of this platform to our customers.

As part of the integration procedure between the two companies, will there be a consolidation of offices and Delivery infrastructure, especially in countries like Japan, Sweden, Netherlands etc where both companies have presence?

In India, there truly are some location synergies. Our presence in Bangalore and Chennai is relatively small; we have less than 1,000 people.

In contrast, iGate has a stronger presence (in Bangalore and Chennai) and this creates larger opportunities for our people.

Some of our overseas offices are actually two or three people offices. If both iGate and Patni are in the same city, it makes sense for us to actually get into one single office. So some of that (consolidation) may happen.

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