Wipro to Divest Hosted Data Center Services Business to Ensono for USD 405 Million
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading global information technology, consulting and business process services company has signed a definitive agreement to divest Wipro’s hosted data center services business to Ensono, a leading hybrid IT services provider for USD 405 million. Wipro will unlock value by transitioning eight data centers, and over 900 employees of its hosted data center services business to Ensono. The acquisition significantly expands Ensono’s geographic footprint and global service capabilities, taking the company one step closer to achieving its vision of helping clients harness the power of hybrid IT to transform their businesses on a global scale.
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Wipro and Ensono have also signed a long-term partnership agreement to jointly address the hybrid IT requirements of Wipro’s new and existing enterprise customers. As part of the agreement, Wipro will make a strategic investment of USD 55 million in Ensono’s combined entity.
Wipro has been providing comprehensive IT management solutions for large and mid-size enterprises for over 25 years, and operates world-class data centers, globally. The company has expertise across multiple computing environments and platforms, including mainframes, iSeries, Unix, Windows and Linux servers, and offers an array of delivery models ranging from customized solutions delivered in Wipro’s data centers to remote management and cloud computing.
Hosted Datacenter services business is one of the three businesses that became a part of Wipro when it acquired Infocrossing Inc in 2007. The other two businesses -- Medicare & Medicaid services in the health insurance space and ERP implementation services -- have been integrated with other Wipro businesses and are not part of this divestment.
“As we embrace our strategy of focusing on newer digital areas of spend, our strategic investment and partnership with Ensono will enable us to remain committed to meeting the hosted data center services requirements of our customers. This partnership will enhance the global data center footprint and expand the available talent pool which will give us economies of scale and allow us to offer end-to-end capabilities in the infrastructure space, better than ever before,” said Kiran Desai, Senior Vice President, Global Infrastructure Services, Wipro Limited.
Ensono provides hybrid IT services, from cloud to mainframe, that enable clients to digitally transform their business. Through the acquisition, Ensono is doubling in size, diversifying its client portfolio and increasing its annualized revenue to be in excess of USD 550 million. Beyond a growing geographic footprint and data center presence, Ensono will manage over 260K MIPS and over 30K hosted servers. Whether clients are leveraging the power of the cloud or modernizing legacy technologies, Ensono helps clients manage complex IT requirements, globally and across industries.
“This is the third acquisition in less than three years for Ensono. This particular acquisition and partnership with Wipro substantially increases our ability to scale and service our growing client portfolio. We are increasing our geographic presence by expanding our data center operations in Germany, U.K. and the U.S., as well as establishing an operational presence in India,” said Jeff VonDeylen, CEO, Ensono . “These are strategic moves that bring us one step closer to our vision of being a recognized leader in true hybrid IT and a relentless ally to our clients.”
The acquisition is subject to customary closing conditions and regulatory approvals and is expected to close in the quarter ending June 2018. Ensono is a portfolio company of Charlesbank Capital Partners and M/C Partners. Jefferies LLC acted as an exclusive financial advisor to Ensono for this transaction, and Credit Suisse Securities (USA) LLC acted as the sole financial advisor to Wipro. Goodwin Procter LLP and Ropes & Gray LLP acted as legal advisors to Ensono, and Hughes Hubbard and Reed LLP (for the US), and DLA Piper (for Europe) were legal advisors to Wipro on this transaction.
About Wipro Limited
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading global information technology, consulting and business process services company. We harness the power of cognitive computing, hyper-automation, robotics, cloud, analytics and emerging technologies to help our clients adapt to the digital world and make them successful. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, we have over 160,000 dedicated employees serving clients across six continents. Together, we discover ideas and connect the dots to build a better and a bold new future.
For business leaders managing lots of complexity or disrupting the status quo, Ensono delivers complete Hybrid IT services, from cloud to mainframe, tailored to each client’s journey. Whether you’re leveraging the power of the cloud or modernizing legacy technologies, you’ll be on track to operate for today and optimize for tomorrow. Named a Top 15 Sourcing Service Provider by ISG, some of the world’s most successful companies rely on us to help them be great at what they do. Ensono has over 1,000 associates across North America and Europe and is ranked 21st in The Sunday Times 100 Best Companies to Work For. Our offices are headquartered in greater Chicago. Visit us at www.ensono.com .
Forward-looking and Cautionary Statements
Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, intense competition in IT services, our ability to maintain our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India, unauthorized use of our intellectual property, and general economic conditions affecting our business and industry. Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission. These filings are available at www.sec.gov . We may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company’s filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.
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