Strategic deal to help clients of both companies innovate faster
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading global information technology, consulting and business process services company has signed a definitive agreement to divest Wipro’s hosted data center services business to Ensono, a leading hybrid IT services provider for USD 405 million. Wipro will unlock value by transitioning eight data centers, and over 900 employees of its hosted data center services business to Ensono. The acquisition significantly expands Ensono’s geographic footprint and global service capabilities, taking the company one step closer to achieving its vision of helping clients harness the power of hybrid IT to transform their businesses on a global scale.
Wipro and Ensono have also signed a long-term partnership agreement to jointly address the hybrid IT requirements of Wipro’s new and existing enterprise customers. As part of the agreement, Wipro will make a strategic investment of USD 55 million in Ensono’s combined entity.
Wipro has been providing comprehensive IT management solutions for large and mid-size enterprises for over 25 years, and operates world-class data centers, globally. The company has expertise across multiple computing environments and platforms, including mainframes, iSeries, Unix, Windows and Linux servers, and offers an array of delivery models ranging from customized solutions delivered in Wipro’s data centers to remote management and cloud computing.
Hosted Datacenter services business is one of the three businesses that became a part of Wipro when it acquired Infocrossing Inc in 2007. The other two businesses -- Medicare & Medicaid services in the health insurance space and ERP implementation services -- have been integrated with other Wipro businesses and are not part of this divestment.
“As we embrace our strategy of focusing on newer digital areas of spend, our strategic investment and partnership with Ensono will enable us to remain committed to meeting the hosted data center services requirements of our customers. This partnership will enhance the global data center footprint and expand the available talent pool which will give us economies of scale and allow us to offer end-to-end capabilities in the infrastructure space, better than ever before,” said Kiran Desai, Senior Vice President, Global Infrastructure Services, Wipro Limited.
Ensono provides hybrid IT services, from cloud to mainframe, that enable clients to digitally transform their business. Through the acquisition, Ensono is doubling in size, diversifying its client portfolio and increasing its annualized revenue to be in excess of USD 550 million. Beyond a growing geographic footprint and data center presence, Ensono will manage over 260K MIPS and over 30K hosted servers. Whether clients are leveraging the power of the cloud or modernizing legacy technologies, Ensono helps clients manage complex IT requirements, globally and across industries.
“This is the third acquisition in less than three years for Ensono. This particular acquisition and partnership with Wipro substantially increases our ability to scale and service our growing client portfolio. We are increasing our geographic presence by expanding our data center operations in Germany, U.K. and the U.S., as well as establishing an operational presence in India,” said Jeff VonDeylen, CEO, Ensono. “These are strategic moves that bring us one step closer to our vision of being a recognized leader in true hybrid IT and a relentless ally to our clients.”
The acquisition is subject to customary closing conditions and regulatory approvals and is expected to close in the quarter ending June 2018. Ensono is a portfolio company of Charlesbank Capital Partners and M/C Partners. Jefferies LLC acted as an exclusive financial advisor to Ensono for this transaction, and Credit Suisse Securities (USA) LLC acted as the sole financial advisor to Wipro. Goodwin Procter LLP and Ropes & Gray LLP acted as legal advisors to Ensono, and Hughes Hubbard and Reed LLP (for the US), and DLA Piper (for Europe) were legal advisors to Wipro on this transaction.