Global outsourcer Capgemini announced on Monday that it has agreed to acquire rival IGATE for $48 per share in cash. The total value of the deal is $4 billion. Of note, the merger agreement has been approved unanimously by both Capgemini’s and IGATE’s Board of Directors, and has also been approved by the written consent of a majority of IGATE’s shareholders.

Capgemini

The combined group will have estimated total revenues of €12.5 billion ($13.6 billion) in 2015, operating margins topping 10% and close to 190,000 employees. Analysts note the expanded firm is ramping up into a real competitor for tech services sector leader Accenture.

More on Capgemini’s acquisition of IGATE

IGATE has a well-established position in the financial services sector (42% of revenue), and also brings an attractive portfolio of major clients to the table. The deal establishes Capgemini’s position as a leader in the retail, manufacturing and healthcare sectors, and will enable a more rapid transition to platform-based solutions.

Management expects cross selling revenue synergies of $100-150 million from the combined firm, and annual efficiency gains estimated at $75-105 million within three years.

Statements from principals

In a statement released Monday, Paul Hermelin, Chairman and CEO of Capgemini, noted: “I am very pleased to announce a very important transaction in Capgemini’s history. IGATE is a leading company that perfectly fits our strategic ambition. It will give us a new status on the American market, and take further our industrialization journey to offer ever more competitive services to our clients. This will also give to the Group’s Indian operations a new scale, allowing us to compete on par with the best US-based and Indian-based companies. I am glad to welcome new talents and leaders to our Group, who share our convictions and professional culture.”

Ashok Trivedi, Co-Founder and Co-Chairman of IGATE commented: “We are pleased to have found a great partner for the business and are confident that our employees and customers will benefit from the enhanced service offerings and resources available to them at Capgemini.”

Sunil Wadhwani, Co-Founder and Co-Chairman of IGATE said: “We are gratified that the company we founded over 25 years ago has developed into a global enterprise with over 30,000 employees, a trusted partner to over 250 clients, a market value of over $4 billion, and one of the most respected brands in the IT industry.”

More on IGATE

IGATE is a technology and services company based in New Jersey with 2014 revenues of $1.3 billion. The firm is enjoying double-digit growth and robust 19% operating margins. North America represented almost of the firm’s revenues in 2014, followed by Europe  at14% and Asia-Pacific  at 7%. The addition of IGATE beefs up Capgemini’s key application and infrastructure services verticals, as well as BPO and engineering services. The transaction also means new flagship clients including General Electric and Royal Bank of Canada.