Infosys buys Singtel’s Malaysia delivery center

Infosys Ltd, one of India’s top IT services providers, said it has agreed to acquire Singapore Telecom’s Malaysia delivery center for up to SGD 6 million or around Rs 33.3 cr.

Global Enterprise International Malaysia “acts as a delivery center to provide customer experience and technology services to Singtel,” the Bangalore-based company said.

The company had revenue of Rs 121 cr in the year ended March.

Global Enterprise International Malaysia has seen some uncertainty in its revenue growth in recent years. It had revenue of myr 70.4 mn in FY19, which fell to myr 62.4 mn in FY20, before recovering to 67.4 mln myr in FY21.

Infosys did not reveal the number of employees gained with the acquisition.

The move has to be seen in the context of increasing ‘platform plays’ by Indian IT companies, which started out as suppliers of engineers around 40 years ago, in today’s era of cloud computing.

Under a platform play, companies such as Infosys and TCS have their own IT delivery mechanism, and deliver their software-enhanced services using the internet.

This involves the use of higher and higher degrees of automation and artificial intelligence to reduce the dependence on human effort and bring down costs.

The delivery of next-generation of outsourced services using cloud computing requires a high degree of expertise and familiarity with networking and telecom, which is where acquisitions like Global Enterprise International Malaysia come in.

Infosys did not elaborate on the rationale behind the move, but said its move “aligns with Infosys’ long-term strategy for Communications, Media, and Technology (CMT) vertical including platform led transformation of Customer and Service Experience for clients.”

Besides, it pointed out, it would immediately give Infosys a base for further expansion in the Malaysian market. In Infosys’ own words, the deal would “bolster its presence in Malaysia, a strategic delivery and sales hub in South East Asia for global clients.”

The cash-led acquisition will see 100% of the company’s share capital transferred to one of the Bangalore-based company’s subsidiaries.