Infosys Pays $120 Million for Kallidus, Digital E-commerce Provider

Written by DH Kass 1
April 27, 2015

Infosys bought Kallidus, a digital e-commerce services provider, for $120 million, to add automation and innovation to its service portfolio.

Infosys has snapped up Kallidus, a digital e-commerce services provider, for $120 million, in a deal the India-based software services company said will add automation and innovation to its portfolio as it tacks to more high-margin offerings under new chief executive Vishal Sikka.

The acquisition comes as Infosys posted Q1 2015 net profit of $498 million, a 2 percent uptick from last year, on $2.16 billion in sales, a 3.2 percent bump from a year ago. Neither result met analysts’ expectations of $509 million in net profit on revenue of $2.23 billion for the period.

Infosys’ purchase of Kallidus is the company’s second substantial acquisition in two months. In February, it bought Panaya, an enterprise resource planning (ERP) automater, for some $200 million, the company’s first acquisition under Sikka.

The company also said it is investing some $2 million into Airviz, an air quality monitoring startup. AirViz’s technology provides information on air quality in indoor and closed environments. InfoSys did not disclose how much of AirViz it now owns.

Infosys, India’s third largest software services company, last June brought in Sikka, a former SAP (SAP) executive board member and the first non-founder in the company’s history to serve as CEO, to overhaul its strategy and stabilize its executive suite. In the last two years, some 13 senior executives reportedly have exited the company.

Since then, Sikka has fortified Infosys’ management ranks by hiring a number of former SAP executives, presided over two noteworthy acquisitions, invested in startups, recast the vendor’s strategy and projected a growth path to some $20 billion in sales by 2020.

“The new technology areas in Infosys of automation and innovation will constitute a tenth of total revenue by 2020,” he said, on an analysts’ call. “By 2020, our revenues will be $20 billion with a 30 percent margin and the revenue per employee at $80,000,” he said.

That would amount to a 57 percent boost in employee productivity in five years.