HCLTech, the third largest IT services company in India, has acquired a 100 per cent equity stake in German automotive engineering services provider ASAP Group for €251 million ($279.72 million). The deal is expected, which will be done through HCLTech’s UK subsidiary, to be sealed by September 2023, which is now subject to regulatory approvals, the IT major said in an exchange filing on Thursday.
The acquisition is expected to help the IT company in strengthening its portfolio in areas such as autonomous driving, e-mobility and connectivity. Also, the deal will help the IT major in expanding its services into key automotive markets in Europe, the Americas and Japan.
ASAP is focussed on future-oriented automotive technologies in areas such as autonomous driving, e-mobility, and connectivity, HCLTech said. Founded in 2010 and with its headquarters in Ingolstadt, ASAP works with the top automotive original equipment manufacturers (OEM) and tier-1 suppliers in Germany.
“ASAP has developed some exciting capabilities in automotive engineering and we share their vision for the future of mobility. This agreement will enable us to scale these capabilities and innovations across our global network,” said Hari Sadarhalli, corporate vice-president, engineering and R&D services, HCLTech.
He added: "Core engineering is at the heart of HCLTech's DNA and truly differentiates our services portfolio. This investment also reinforces our commitment to Germany, which is a focus market for us. We will continue to nurture local talent and innovation ecosystem to unlock their potential."
Michael Neisen, CEO of the ASAP Group added, "We are delighted to align our growth journey with HCLTech's purpose of bringing together the best of technology and people to supercharge progress for all stakeholders. We are confident that the combination of HCLTech and ASAP's engineering and technology performance will bring best-in-class advantages to the automotive industry worldwide."
On Wednesday, HCLTech reported that its net profit grew 7.6 per cent year-on-year (YoY) in Q1 FY24 to Rs 3,534 crore as against Rs 3,283 crore in the year-ago period, while sequentially it fell by 11.2 per cent. The company also reported a slower order book of $1.56 billion for the quarter as compared to its usual range of $2 billion and above.
The company announced interim dividend of Rs 10 per equity share.
The company's consolidated revenue rose 12% to Rs 26,296 crore in Q1FY24 as against Rs 23,464 in the year-ago period.