Wipro To Acquire Citi Technology Services Ltd. [India]

Wipro and Citi Enter Agreement for Wipro to Provide Information Technology Services to Citi and its Businesses.

Bangalore, India and New York, USA – Wipro Technologies, the global IT services business of Wipro Limited (NYSE:WIT), and Citigroup Inc . (Citi), the leading global financial services company, today announced that they have reached an agreement for Wipro to acquire Citi Technology Services Ltd., the India-based captive provider of information technology services and solutions to Citi entities worldwide, for an all cash consideration of approximately $127 million. As part of the transaction, Wipro and Citi will sign a Master Services Agreement for the delivery of Technology Infrastructure Services (TIS) and Application Development and Maintenance (ADM) services for a period of six years. The agreement provides for the delivery of at least $500 million in service revenues over the period of the contract.

Based in Mumbai and Chennai, Citi Technology Services provides IT services to Citi and its affiliates around the world. Citi Technology Services has grown tremendously since its inception in 2005, and today has approximately 1,650 employees trained in Citi processes and technologies, servicing Citi businesses in more than 32 countries. Citi Technology Services’ revenues are expected to be approximately $80 million in CY2008. Apart from strong competencies in TIS, Citi Technology Services has expertise in ADM for Cards, Capital Markets and Corporate Banking .

This transaction strengthens Wipro’s existing relationship with Citi with a long-term agreement for Wipro to deliver TIS and domain -led ADM services to all Citi business segments.

Girish S. Paranjpe, Jt CEO, IT business and Member of the Board, Wipro said, “Citi has played a pioneering role in leveraging technology for banking. We are pleased that our domain expertise and infrastructure management capabilities positioned us as their partner of choice. This posit ion has further strengthened with this strategic transaction. We are delighted to welcome the employees of Citi Technology Services into the Wipro family.”

Don Callahan, Chief Administrative Officer, Citi said , “This sale was the result of a thorough process to ensure we were partnering with the right company for our businesses and our clients . Wipro, with its wide range of services, extensive experience and broad global presence can play a significant role in meeting Citi’s objectives of productivity improvement, while our Citi Technology Services employees will join a larger information technology organization with additional third party growth opportunities. This transaction is consistent with our efforts to improve our operating leverage while we focus on our core banking competencies.”

Marty Lippert, Chief Operations and Technology Officer, Citi said, “This partnership enables Citi to leverage Wipro’s expertise in information technology services where we have significant plans for driving higher efficiencies by leveraging the Global Delivery Model.”

Jagdish Rao, Global Technology Head, Citi, added, “Wipro brings the maturity of processes and skilled management to help us build upon the success we have had with Citi Technology Services in the Infrastructure Management space .”

Soumitro Ghosh, Sr Vice President, Finance Solutions, Wipro, said, “Citi Technology Services team’s expertise in addressing the risk and compliance issues for banking industry positions us well to offer similar scale and complexity of services to other leading banks in US and Europe. We are confident that the skillsets we have acquired will enhance our capabilities to compete for more TIS business in the financial services industry in general and Citi in particular.”

The transaction is expected to be closed by March 2009, subject to customary closing conditions and regulatory approvals.