Capgemini, a European provider of consulting, technology and outsourcing services, has reached an agreement with the shareholders of CPM Braxis which will see Capgemini acquire a 55% interest in the leading Brazilian IT services company.

 

The deal will enable Capgemini to boost its presence in Brazil – an IT services market it says shows a high potential. 

 

In a press realease, Capgemini said the agreement will help it to widen its client base while increasing support for its international clients in Brazil. 

 

With more than 5,500 employees, CPM Braxis is said to have a diversified business portfolio focused on application outsourcing, enterprise application services, infrastructure integration and infrastructure services - a majority of which is delivered through multi-year contracts.

 

CPM Braxis serves over 200 clients and is particularly strong in the financial sector. Its biggest client, major Brazilian bank Bradesco, was also its biggest shareholder prior to the transaction.

 

CPM Braxis said it expects to record 2010 revenues of about BRL 1 billion ($692.44 million). The company saw growth of 12% in 2009 and expected to grow a further 20% in 2010, as it registers an Ebit maring of about 6 percent.

 

Under the terms of the transaction, Capgemini will acquire 55% of the share of CPM Braxis, representing a total amount of €233 million. The enterprise value of CPM Braxis is estimated at €437 million. The operation will be funded using the group’s net cash position.

 

With this deal, Brazil will become the group’s sixth largest country in terms of headcount, with more than 6,200 employees.