- 27 Apr 2022
- ICICIdirect Research
Wipro acquires SAP consulting firm RIZINGWIPRO - 362 Change: -4.90 (-1.34 %)
News: Wipro has signed a definitive agreement to acquire RIZING , a global SAP consulting firm. The purchase consideration for this acquisition is US$540mn ( 2.7x price to sales). RIZING , Headquartered in Stamford, USA, has 20+ offices across North America, Europe, Asia and Australia. It has 1300+ employees with presence in 16 countries. SAP Consulting capabilities include i) enterprise asset management for asset heavy industries like Oil & Gas, Utilities , Transportation & Logistics ii) leading provider of SAP retail & fashion suite for retail iii) leading human capital management solutions partner in HR practices, payroll, employee engagement .
Views: RIZING revenue grew by 12% CAGR over CY19-21. Assuming acquisition completion within the specified timeline i.e before 30th June, it would add ~1.5% incremental revenues for FY23 while there is no information on margin impact in terms of earn-outs or integration costs. As one of the leading strategic partners in the world for SAP, Rizing will become a critical extension of Wipro’s SAP Cloud practice and Wipro Full Stride Cloud Services. It will also help Wipro expand its leadership in oil & gas, utilities, manufacturing, and consumer industries and may provide intangible benefits like winning large deals and also in terms of better pricing discipline. Wipro has US$2.8bn cash on the books.