Key Highlights
- Coforge has signed a definitive agreement to acquire Encora
- The proposed acquisition values Encora at an enterprise value of USD 2.35 billion.
- The deal is structured as an all stock transaction with no cash outflow.
- Encora shareholders are expected to hold around 20 percent stake in Coforge post completion.
- The acquisition remains subject to shareholder and regulatory approvals.
Coforge has signed a definitive agreement to acquire Encora, as part of its strategy to strengthen capabilities in AI led engineering, data and cloud services.
The proposed transaction values Encora at an enterprise value of USD 2.35 billion and will be executed entirely through equity. Upon completion, Encora’s existing shareholders, including Advent International and Warburg Pincus, are expected to collectively hold approximately 20 percent stake in Coforge. No cash consideration is involved in the deal structure.
Strategic Intent of the Proposed Acquisition
Coforge has indicated that the proposed acquisition is aimed at building a scaled AI native services platform focused on engineering, cloud and data. Encora brings experience in AI led product engineering, cloud modernization, data engineering and agent based software development, which is expected to complement Coforge’s industry focused technology services portfolio once the transaction closes.
The combined entity, post completion, is expected to target the creation of a USD 2.5 billion technology services platform, with AI led engineering, cloud and data services forming a significant share of future revenues.
Industry and Geographic Expansion Plans
If completed, the acquisition is expected to strengthen Coforge’s presence in high growth industry segments such as hi tech and healthcare. Encora’s portfolio spans pharma, medtech and healthtech, along with AI enabled solutions across research and digital healthcare platforms.
The deal is also expected to enhance Coforge’s nearshore delivery footprint, particularly in Latin America, and support expansion across the US market, including the West and Mid West regions, which are key focus areas for growth.
Approval Process and Timeline
The transaction is currently at the agreement stage and is subject to shareholder approvals and regulatory clearances. Coforge has indicated that the closing process is expected to take several months, following which the integration process would commence. Until completion, both companies will continue to operate independently.