While the IT mid-market continues to be soft in Europe, with margins being ever so squeezed by major accounts, Infosys is taking the lead and expanding its acquire-onshore-to-offshore-in-India business model. It has been known in European IT circles that Infosys is looking for acquisitions, and it might just have happened. Sources tell us that they may have finalised two European acquisitions. The leading IT offshoring giant will invest about USD 300M for the acquisitions.
Clearly the timing is right as European IT company values are down, for the mid-market ones. And if Infosys executes their integration correctly into their backoffice in India, margins will bump up and the acquisitions will look like a bargain.
On another note, the IT giant is not sleeping on its laurels. I always said that you need to reinvent your org chart every 24 months. Well, Infosys has appointed a three member panel to chart out the giant's restructuring roadmap.
Infosys is looking to reorganize into seven key verticals, where each vertical will be divided into different horizontals. Three to four key vertical heads are likely to be shuffled in the reorganization. The restructuring roadmap is planned to take three to four months to complete. Good initiative!
