The Capgemini-IGATE merger will make the French company a leading employer of Indian engineers, thereby enabling it to better compete with domestic vendors for price-sensitive IT engagements, industry insiders feel.

“Our estimate is that Capgemini-IGATE would currently employ 83,000 people in India. This number could easily go upto 1,00,000 by the end of this year. This suddenly makes Capgemini very competitive from a delivery standpoint,” said Sanchit Vir Gogia, Founder-Chief Executive Officer at advisory firm Greyhound Research.

Job-creation

“We believe that Capgemini will become the third largest MNC IT employer in India after IBM and Accenture. Moreover, more jobs will move to India from Capgemini’s global operations going forward,” said Gogia. With this deal, Capgemini now has more employees globally than Wipro, India’s third largest software services firm. As on March 31, Capgemini had an overall headcount of 1,47,016 while IGATE had 31,453 staffers on its rolls.

Thus, the collective entity will have 1,78,469 employees immediately, while Wipro has an employee base of 1,58,217 by the previous year-end. Once the Capgemini-IGATE deal closes, Capgemini is expected to have 1,90,000 people on its rolls.

It may be recalled that Capgemini’s India operations had got a major boost in 2006 after it agreed to acquire Kanbay International, which had significant operations in India. The IGATE acquisition is further expected to strengthen the company’s global delivery model.

“Our recent interactions with 30 large customers in the USA confirm that Capgemini has become more aggressive in the US and is winning some business previously held by Indian firms,” said Peter Schumacher, President and CEO of Value Leadership Group, a management consulting firm. The likes of TCS, Infosys and Wipro are generally able to offer their services at competitive price points because of strong offshore leverage.

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