IT services company HCLTech Ltd on Thursday (May 23) said it will be buying Communications Technology Group (CTG) assets of Hewlett Packard Enterprise (HPE) for $ 225 million, about ₹1,874 crore, in an all-cash deal.
As part of this agreement, approximately 1,500 employees of CTG with telecom industry experience will transfer to HCLTech in various countries — including Spain, Italy, India, Japan and China — to service clients globally.
Through this arrangement, HCLTech will acquire industry-leading intellectual property (IP), engineering and R&D talent and client relationships with top global Communication Service Providers (CSPs), HCL Technologies said in a regulatory filing.
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The deal will strengthen HCLTech’s presence in the telecom vertical by expanding its engineering services and leveraging CSS’ IP, solutions and talent at leading CSPs in Europe, Japan, the Americas and the APAC region, including 20 of the top 30 CSPs globally.
HPE will retain the part of its former CTG business focused on Operations Support Systems (OSS). The Telco Solutions Group, which sits within HPE Aruba Networking, is a leader in OSS, orchestration and assurance —
as well as public 5G SDM and private 5G networking — and will continue to deliver value for HPE’s telco customers and partners.
“With this transaction and our planned strategic partnership with HPE, we are strengthening our telecom practice to address the rapidly expanding and transforming global telecom market. With the incoming top engineering talent and industry-leading IP from the CTG group of HPE, we are adding significant capabilities and direct relationships with global CSPs,” HCLTech CEO and managing director C Vijayakumar said.
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This transaction is subject to regulatory approvals and other customary closing conditions and is expected to close in 6 to 9 months.
“In joining HCLTech, our Communications Technology Group will become part of a strong partner that understands and appreciates the significant heritage of our CTG business, its strategy and its potential for the future,” HPE President and Chief Executive Officer Antonio Neri said.
Shares of HCL Technologies Ltd ended at ₹1,353.40, up by ₹10.30, or 0.77% on the BSE.
