Continuing the trend of Nearshore-related acquisitions, IT services giant Cognizant has announced the purchase of digital engineering company Softvision, adding 2,850 developers to its pool of resources.
After four months of discussions between the two companies, the agreement has been signed and will be fully closed in 4Q18. The financials and terms of the deal are not being disclosed, but the Softvision brand will remain intact.
Cognizant has been investing heavily in digital transformation, a topic that Softvision has been committed to on a global scale and resulting in growth of around 18% year to year.
“Cognizant wants to become the leading player in the digital economy, so they took notice of Softvision and the interesting digital transformation projects we have been realizing,” said Andrés Angelani, CEO of Softvision in an interview with Nearshore Americas.
“On our side, we wanted to continue scaling, and can now do so with the help of Cognizant’s digital engineering teams.”
Angelani expects the new partnership to lead to significant growth in the Nearshore region, especially in Argentina where both companies already have presence.
Although it was founded more than 20 years ago, Softvision only settled in the country at the start of this year. The company’s original plan for Buenos Aires was to grow the office by 200 people in one and a half years. It currently has 30-35 people there and is recruiting heavily to hit this goal, but with Cognizant’s input those numbers could be significantly altered, according to Angelani.
“Making the move to Argentina and hiring the team in Buenos Aires was a really good move to help with our overall strategy in the region,” he said. “We’re trying to find out if the skills are compatible with what we need so that we can infuse the teams. We don’t know exactly how the synergy will look, but we do know that the Buenos Aires office will grow.
“Nearshore is important for us to keep customer relationships high-tough, and when you are delivering transformational products for customers – “greenfield” products in Cognizant language – then that Nearshore presence is vital.”
In terms of industry verticals, Softvision is bringing expertise and assistance for financial services, retail, media, technology and telecoms at the start, but expects to help Cognizant out with others over time.
“There are many synergies where we can add value to Cognizant, as well as them facilitating our needs to scale,” said Angelani. “It’s a strategic move for both sides, giving us access to much larger businesses and Fortune 100 clients that are looking for the types of methodologies, product design, and engineering talent that we possess.”
Softvision is known for its agile teams of 8-10 people known as “pods”, which can be sourced from all of its global delivery centers. Operationally, Cognizant is embracing this approach, so Angelani expects the strategy to expand across both companies.
“We will have more access to Cognizant’s investments in IT, its products and accelerators, and its alliance partners, which are all things we can plug into our community model,” he said. “This means that the value-add for the customer will be higher, our client partnerships will be more rounded, and we can bring more quality that can be found through the joint expertise of both companies.”
Angelani was named Nearshore Voyager of the Year at our 2018 Illuminate Awards, a recognition that he found highly appropriate.
“It’s a very accurate award and I expect to be even more of a “Voyager” next year now that we have this new platform driving us,” he laughed. “Before we went public on the Cognizant deal, we talked to all of our teams and they received the news with great excitement, and everyone thinks this will be a great partnership for the future.”