Coforge shares gain as CCI approves acquisition of 54% stake in Cigniti Technologies

The proposed transaction involves Coforge acquiring between 50.21% and 54% of Cigniti Technologies’ fully diluted shareholding. This acquisition will be executed through share purchase agreements and a mandatory open offer, complying with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

Shares of Coforge Limited opened the session at ₹5,395 apiece on the NSE, higher than its previous close of ₹5,350.65, before hitting the intraday high of ₹5,462.85 on Wednesday.

As the session progressed, the stock pared the gains in the early trade. Shares of Coforge closed at ₹5,326 apiece on the NSE, down by ₹24 or 0.46%.

Around the same time, shares of Cigniti Technologies Limited were trading at ₹1,351.80 on the NSE, marking a gain of ₹6.35 or 0.47%.

On May 2, Coforge’s board approved the acquisition of Cigniti. The company then announced that it had entered into a definitive agreement to acquire Cigniti Technologies Limited, aiming to accelerate its growth trajectory to reach ₹2 billion by FY27.

The acquisition is expected to enhance Coforge’s operating margins by 150-200 basis points by FY27. The rationale behind the acquisition, Coforge said, included the creation of three expanded verticals in retail, technology and healthcare, facilitating the company’s expansion across southwest, mid-west and western US markets.

The company said the acquisition positions Coforge to capitalise on emerging opportunities in specialised Assurance Services amid the increasing adoption of artificial intelligence (AI).

Last month, on May 21, in an exchange filing, Coforge announced that it has entered into a strategic partnership with Microsoft to introduce the Copilot Innovation Hub, a platform designed to propel the adoption of generative artificial intelligence (AI) technology across enterprises.

The Copilot Innovation Hub will focus on creating specialised AI solutions in collaboration with Microsoft, leveraging technologies like Microsoft Copilot, Microsoft Power Platform and Microsoft Azure OpenAI Service to integrate these innovations into various industry-specific applications.

Coforge, a publicly listed company, specialises in providing information technology (IT) and IT-enabled services (ITES), including various sub-segments within India. Cigniti, also a publicly listed company, is engaged in the provision of IT and ITES across India, covering diverse sub-segments.