French IT services outfit Atos announced this week the company has completed its €811m acquisition of Xerox’s IT outsourcing business, a move the companies said would give the combined entity a massive leap forward in the outsourcing market.
Originally announced on the tail end of last year Atos and Xerox agreed to a net total acquisition price of $966m (€ 811m), composed of $950m and an additional $50m assuming certain performance metrics were hit, plus $100m representing the estimated value of future tax benefits to Atos.
Xerox’s ITO business includes about 9,800 employees in 45 countries, with most – 4,500 – based in the US and more than 3,800 in global delivery countries.
Atos said the move, which gives it some strong capabilities in business process outsource and document outsourcing, means North America becomes its largest segment. While the company is popular in the Europe and the UK it’s currently ranked number 9 in North America in terms of outsourcing revenue.
“Today marks a major step in the development of the Atos Group, as we welcome 9,600 Xerox ITO employees to Atos,” said Thierry Breton, Chairman and chief executive of Atos. “With the US now our largest market, we have a stronger and more balanced global presence, which combined with our digital skills, allows us to be the trusted partner for our clients’ digital journey anywhere in the world.”
The companies also announced a deal that would see Atos become one of Xerox’s primary IT service providers globally.
Michel-Alain Proch, group senior executive vice president and recently appointed chief executive of Atos’s North American operations added: “Together with Xerox teams, we have worked extensively to be ready from day one post-closing and we are now fully operational to ensure continued delivery of services to our clients while at the same time leveraging the combined strengths of the two groups for profitable growth.”