India’s Coforge Goes Nearshore With $2.35 Billion Encora Acquisition

Indian IT services firm Coforge has agreed to acquire Encora in a $2.35 billion all-stock deal, marking a strategic push into AI-led digital engineering at a time when demand for traditional IT outsourcing is slowing.

The acquisition will significantly expand Coforge’s footprint in the Americas, adding delivery operations across dozens of US cities and nearshore centres in at least six countries, including Mexico, Costa Rica, Colombia, Peru, Argentina and Brazil.

The deal will also bring US private equity investors Advent International and Warburg Pincus onto Coforge’s board, strengthening its global investor base.

Coforge expects the combined entity to generate around $2 billion in revenue from AI engineering, data and cloud services by FY27. Of this, AI-led product engineering alone could contribute nearly $1.25 billion—close to Coforge’s standalone FY25 revenue of $1.4 billion.

Encora employs about 9,200 people, mainly across Mexico, Colombia and the United States, and serves around 11 clients with annual revenues exceeding $10 million each.

Its strong presence in the US West and Midwest complements Coforge’s traditional strength in the Northeast and Southeast, giving the merged firm a more balanced US delivery network. Analysts note that US enterprises increasingly prefer multi-location delivery models to reduce risk and manage costs.

Encora brings with it an established agentic AI platform, AIVA, which is used by thousands of US enterprises. The platform has strategic partnerships with AWS, Microsoft, Google and Snowflake. Encora focuses on digital-native sectors such as hi-tech and healthcare—areas where Coforge has had limited exposure so far.

This sector mix strengthens Coforge’s credibility in AI-driven modernization, a category where enterprise spending remains resilient despite broader cost pressures in IT budgets.

The transaction could lift Coforge’s FY27 revenue by nearly 28% and materially deepen its presence in North America.

Calling the acquisition a turning point, Coforge CEO and Executive Director Sudhir Singh said the deal creates a scaled AI-led engineering capability for the firm, supported by strengths in building enterprise data platforms and cloud foundations designed specifically for AI workloads.