New Jersey data center provider Infocrossing (IFOX) has agreed to be acquired by Indian software company Wipro Ltd. (WIT) for $18.70 a share, or about $600 million. The sale price is a premium of about 5 percent above Infocrossing's Friday closing price of $17.73. Shares of the Leonia, N.J. company have been trading between $17 and $18.50 a share since early June, suggesting any "deal premium" may have already been factored into Infocrossing's share price.
The deal is one of the largest overseas purchases by an Indian software maker, and will help Wipro enhance its off-shore infrastructure outsourcing services. "The acquisition will help Wipro address the existing gap in managed hosted services in infrastructure management," said Sudip Banerjee, president, enterprise solutions, Wipro Technologies. "This will also open existing opportunities in the total outsourcing space, which include IT infrastructure services. We expect the combined infrastructure business to touch $1 billion in 24-36 months."
"Infocrossing is a perfect fit in our remote infrastructure-services offering," said Wipro Chief Financial Officer Suresh Senapaty. "We expect to achieve an industry-leading role with this acquisition."
Founded in 1985, Infocrossing went public in 1992. The company has 900 employees and five data centers, located in Leonia, N.J.; Norcross, Ga.; Omaha, Neb.; Tempe, Ariz.; and Brea, Calif. The company has built a strong position in healthcare, providing infrastrucutre and app management services to more than 150 managed care companies and pharmacy benefit organizations.
"Infocrossing is pleased to be joining such a strong global organization such as Wipro Technologies," said Zach Lonstein, Chairman and Chief Executive Officer of Infocrossing. "We selected Wipro after conducting a full process and believe that by coupling our strong services and U.S.-based operations with the global delivery model of Wipro Technologies, we will be able to drive additional value for the shareholders and clients of both our companies."