HCL Technologies Ltd. is acquiring a German automotive engineering services company for $280 million to push beyond IT consultancy into expertise in self-driving vehicles.
(Bloomberg) — HCL Technologies Ltd. is acquiring a German automotive engineering services company for $280 million to push beyond IT consultancy into expertise in self-driving vehicles.
India’s third-largest IT services firm said on Thursday it agreed to buy all shares of ASAP Group, which specializes in autonomous driving and e-mobility. The sale is expected to be completed in September if the deal gets regulatory approval, HCL Tech said.
Founded by billionaire Shiv Nadar, HCL Tech is following a push by India’s more than $245 billion software services sector into higher-margin operations requiring more technical knowhow. A leader in engineering research, the South Asian nation is boosting investment in sectors such as telecommunications, transportation and aerospace, according to a KPMG report.
“This investment also reinforces our commitment to Germany, which is a focus market for us,” said Hari Sadarahalli, corporate vice president of engineering and R&D services at HCL Tech.
ASAP provides software, consulting and testing services to carmakers and their suppliers around Europe, and HCL said it plans to use that knowhow to expand into automotive markets in Europe and the Americas.
This would not be the first time HCL Tech sought to expand into new business arenas. Nadar, an engineer by training, earned his billions by pivoting HCL Tech from making personal computers to capitalize on demand for inexpensive backoffice operations from the early 1990s.
–With assistance from Sankalp Phartiyal.
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