Tech Mahindra has acquired Payments Technology Services, an offshore captive of American fintech giant Fidelity National Information Services (FIS), for US$9 million in an apparent bid to secure long-term services agreements.
PTS comes with two widely sought-after digital products in the banking industry: Open Payment Framework (OPF) and Multi-Bank System (MBS).
“The acquisition is consistent with our strategy of pivoting the business towards product and platform implementations and participating in the banking transformation programs,” stated the Indian IT provider in a note posted on the Bombay Stock Exchange.
Hong Kong-based Payments Technology (PTS) has employed 109 people and reported US$5.4 million in revenue for 2019. Once the deal is closed, Tech Mahindra would launch an innovation center in the Indian city of Chennai.
According to Tech Mahindra’s website, banking and financial services (BFSI) account for more than 16% of its revenue.
“BFSI is one of the fastest-growing industry segments for Tech Mahindra and we now have a strong presence across key regions including North America, Europe and the Asia Pacific,” Vivek Agarwal, a senior executive of Tech Mahindra told India’s The Economic Times.
This is yet another example of an Indian IT provider buying offshore captives of large European and US business houses. Such acquisitions help them secure long-term service agreements with companies.