Wipro to buy Citi unit for $127 million

Wipro Ltd, India's third-ranked outsourcer, said on Tuesday it had agreed to buy Citi Technology Services Ltd for $127 million in cash and would sign a six-year service agreement worth at least $500 million.

The deal done through Wipro Technologies, the information technology arm of the New York-listed Wipro, is expected to close in March 2009, Wipro said in a statement. Citi Technology Services is the India-based captive technology services unit of Citigroup.

This is the second time that Citi, will sell off its Indian back-office operations. In early October, it had sold its captive BPO Citigroup Global Services (CGSL) to Tata Consultancy Services for $505 million.

In addition to the sale, Citi also signed a $2.5-billion deal through which TCS will provide process oursourcing services to Citi and its affiliates over nine-and-a-half years. This will be provided through CGSL.

The acquisition broadens TCS's portfolio of end-to-end IT and BPO services in the global banking and financial services sector.

CGSL is one of the largest providers of BPO services within the banking and financial services sector, providing end-to-end process management across this spectrum and a broad array of services to Citi's consumers, corporate and global wealth management businesses globally.

Sources: Agencies