Tata Buys Citigroup's Tech Services Group for $512 MillionBy Kathleen A. Martin | Posted 2009-01-02 Email Print
Tata Consultancy Services, India s largest IT outsourcing and services company, will provide support for Citigroup and its subsidiaries for the next decade.
TATA Consultancy Services (NYSE: TCL), India's largest software services firm, acquired Citigroup Global Services, the India-based business process outsourcing unit and subsidiary of U.S.-based financial services giant Citigroup.
Citigroup will receive $512 million in cash. The two sides first announced the deal in October, when they also inked a $2.5 billion contract for Tata to provide outsourcing services to Citigroup and its affiliates for the next decade.
"This acquisition gives us the ability to offer an end-to-end, domain-led third-party solution for business operations to our large financial services clients. We will also work to create platforms for the future and integrate our strong domain expertise in operations along with our suite of products for the financial services sector" said N.Chandrasekaran, chief operating officer and executive director at Tata.
The sale is expected to help reduce Citigroup’s operating expenses related to business processing and increase focus on their financial services competencies. It is anticipated that Citigroup will recognize a reduction of more than 12,000 jobs, most based India.