Virtusa plans $270M India acquisition

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By Emily Micucci

Westborough information-technology consultant Virtusa Corp. announced Thursday its plan to pay $270 million for a majority interest in an India IT company that serves the banking industry.

Virtusa and the company to be acquired, Polaris Consulting & Services, would combine expertise to become a global provider of IT services to the financial industry with annual revenue of $826 million, Virtusa said. The company will combine its table domain expertise in consumer and retail banking with Polaris’ strength is in corporate and investment banking.

The acquisition is expected to close during Virtusa’s fourth quarter ending March 31. It would give Virtusa a 51.7-percent stake in Polaris and an open offer to purchase up to 26 percent of outstanding shares of stock from shareholders.

Upon closing of the deal, Citigroup Technology Group has agreed to designate Virtusa and Polaris as a preferred vendor for IT services to its customers.

Polaris has 7,700 employees and is headquartered in Chennai, India. It serves global clients through 12 development centers and has locations in Canada, The United Kingdom, the Asia-Pacific region and the U.S. Its American headquarters are in Piscataway, N.J.

News of the Polaris agreement comes in the midst of a strong earnings year for Virtusa. Revenue increased in the first quarter by 20 percent to $134.8 million, and the company increased its earnings forecast for the year to between $582 million and $594 million.