Cognizant’s CFO says that their acquisition strategy is to acquire specific technology and service skills, competencies and capabilities through focused, small-sized acquisitions. The maximum size of these acquisitions is $200 million – 3.3% of its approximately $6 billion revenues. Cognizant’s acquisition of Zaffera is the most recent in a series of such strategic acquisitions aimed at gaining specific knowledge.
Our acquisition strategy is towards very targeted tuck-in small deals which are targeted towards geographic expansion, building industry expertise and lastly, to acquire technology and services capability. For example, our PIPC acquisition was a very targeted acquisition. PIPC has expertise in large program management capability. It also had geographic presence in the UK and Australia. It has helped us in getting large development projects. Our sweet spot is $20-80 million deals and at the upper end it is $200 million. It is far easier to integrate.
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