Coforge shares soar over 2% as firm to acquire AI player Encora for $2.35 billion in all-stock deal

This comes after the company announced that it will acquire 100% stake in the Silicon Valley-based AI firm Encora for an enterprise value of $2.35 billion (about ₹21,133 crore).

At around 9:38 pm, the stock was trading 1.14% higher at ₹1,692.40 per equity share.

The share has lost over 9% in the past week and more than 11% over the month. On a year-to-date basis, it has declined approximately 12%.

While the stock touched a 52-week low of ₹1,194.01 on April 7, 2025, it reached a year’s high of ₹2,005.36 per unit on December 30, 2024.

The acquisition will be funded through an all-stock transaction. Coforge will issue preferential shares worth about $1.89 billion to Encora's current shareholders, including private equity giants Advent International and Warburg Pincus. Upon completion, the sellers will hold a 20% stake in the expanded share capital of Coforge.

"Coforge has signed a definitive agreement to acquire 100% shares of Encora from Advent International, Warburg Pincus and other minority shareholders. The enterprise value of the transaction is $2.35 billion," Coforge said in a regulatory filing on Friday.

Coforge CEO and Executive Director Sudhir Singh said the acquisition establishes a scaled AI-led engineering capability moat for Coforge, underpinned by capabilities to help create enterprise data cores and cloud foundations purpose-built for AI.

Encora, an AI-native firm providing software engineering services, is projected to report a revenue of $600 million for FY26 with an adjusted EBITDA margin of approximately 19%.

"Coforge's acquisition of Encora will create a $2.5 billion tech services powerhouse wherein AI-led engineering + Data + Cloud services alone are likely to deliver $2 billion revenue in FY27. AI-led product engineering business is likely to be a USD 1.25 billion+ business, Cloud services a $500 million business, and Data engineering a USD 250 million+ business for the firm,” it said

"Furthermore, Hi-Tech and Healthcare industry verticals of Coforge are expected to reach material scale immediately post-acquisition. They will both individually operate at an annualised $170 million+ revenue run rate," Coforge added.

According to the company filing, the transaction will also involve a bridge loan or a qualified institutional placement of up to $550 million to retire Encora's existing debt.

The deal has been agreed at a share price of ₹1,815 per share, representing an 8.5% premium to Friday's close.

Coforge has a total market capitalisation of ₹56,729.28 crore, as of December 29, 2025, according to data on the NSE.