Wipro eyes more IT buys to beat slowdown

MUMBAI: After buying Citi Technology Services (Citos), Wipro is now scouting for IT firms servicing oil, telecom and healthcare industries. The move seems to be driven by the company���s desire to cushion against slowdown.

Healthcare spends are relatively recession-proof and the IT exporter is looking at expanding its footprint in this industry as well as in life sciences in the area of drug discovery, where use of IT can help reduce time to market drugs.

The company also continues to look for opportunities in consulting and in western Europe, although the relatively low growth rates and profitability of these firms make acquisitions less attractive, said KR Lakshminarayana, chief strategy officer for IT businesses.



���Fortunately, we have a strong balance sheet. Last quarter we had a billion dollars in cash. If required we can also take debt. Historically, as company, we���ve not been shy of debt,��� Mr Lakshminarayana, who leads the M&A efforts for the IT arms, told ET.

Wipro has been searching for acquisition opportunities in western Europe since the time of Mr Lakshminarayana���s predecessor, Sudip Nandy. In telecom, Wipro already has a good customer base among equipment makers but is not as strong among service providers.

Mr Lakshminaryana termed the Citos aquisition as one chapter in a book. ���Will continue to look at assets in multiple places. But on any asset we consider, the due diligence will be tougher because of the overall market conditions,��� he said.

Wipro has also appointed Punit Sood, CEO and MD of Citos, to oversee its entire Citigroup business and develop the relationship. The $ 500 million minimum revenue commitment from Citigroup for infrastructure services and application development and maintenance (ADM) makes the bank one of the top customers for Wipro.

Prior to this, Citigroup outsourced only a small amount of work to Wipro, as compared to what it outsourced to Tata Consultancy Services, Satyam Computer Services and global vendors like IBM.