Wipro acquires IT consulting firm AVT for $40 mn

IT services firm Wipro has announced the acquisition of Massachusetts-based Applied Value Technologies for $40 million. This acquisition of the IT services consulting firm will help Wipro enhance its application services capabilities and drive new growth opportunities. 

“AVT helps enterprises transform IT operations through a highly customised and data-driven approach,” Wipro said in a BSE filing. It is an all-cash transaction expected to be completed by December 31. Apart from Massachusetts, AVT has subsidiaries in Singapore and the Netherlands, founded in 2021 and 2022. These companies provide enterprise application development and support services for the global clientele. The company’s consolidated revenue for the calendar year (CY) stood at $19.4 million, up from $8.7 million in CY22 and $0.8 million in CY21.

IT firms are expanding their service offerings and profitability by acquiring companies that focus on niche segments. Companies like Infosys, Wipro, and HCLTech are increasingly turning to M&A to expand into specialised areas like consulting, Generative Artificial Intelligence (GenAI), and engineering research & development (ER&D) due to enhance growth opportunities in the global market, experts note.

In February, Wipro announced that it had acquired a 60% stake in Aggne Global, a US-based insurtech, for $66 million, making it a majority shareholder in the company. This move aims to bolster Wipro's presence in the insurance sector, particularly in property and casualty (P&C) insurance.

In June, the company completed the merger of its step-down subsidiary, Designit North America, Inc., with Wipro Designit Services, Inc. This merger became effective on July 1. In addition to the North American consolidation, Wipro deregistered its Australian subsidiary, Attune Australia Pty Ltd. Wipro stated that these moves are part of a strategic effort to rationalise and consolidate its group structure.