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Wipro has divested its Workday and Cornerstone businesses to Alight Solutions for $110 million.
India’s fourth largest software exporter had bagged a 10-year deal in 2018 from Alight Solutions for $1.5 billion. As a part of the deal —a first of its kind in the Indian IT sector — Wipro will divest both these businesses to Alight Solutions for cash of up to $110 million. Further, out of the $110 million, $100 million would be payable at closing of the deal and the balance $10 million would be a deferred consideration payable at the end of 12 months based on the achievement of performance targets, the company said in a statement.
The deal is expected to close during the quarter ending March 31, 2019.
“This agreement will enable Wipro to sharpen its focus on key offerings wherein it commands a leadership position. We will continue to make significant investments to grow our cloud applications and platforms business,” said Abidali Z. Neemuchwala, Chief Executive Officer and Executive Director, Wipro.
In 2016, Wipro acquired the Workday and Cornerstone OnDemand business as part of its Appirio buyout. Workday and Cornerstone OnDemand have multiple customers across the US, Europe, the Middle East and Africa, and Wipro has delivered 500 Workday engagements and around 3,000 Cornerstone OnDemand projects, the company said.
Wipro also said that it will continue to explore additional strategic opportunities and possible alignment of portfolios with Alight Solutions.
Movement of staff
The divestiture agreement will also result in around 350 employees in both teams moving to Alight’s payrolls. The transaction will expand Alight’s capabilities and resources in HCM and financial solutions, with Wipro’s advisory, implementation and integration offerings, the company said.
Further, Wipro will also continue to support Workday’s suite of solutions for application management, testing and integration services for its existing client base. It will go ahead with its investment plans for the cloud applications and platforms space including growing and expanding its Salesforce business under the Appirio brand.
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