IT service companies are buying niche firms to grow in emerging areas

BENGALURU: Wipro’s decision to acquire US-based International TechneGroup Incorporated (ITI) for $45 million earlier this month is not a one-off. More IT services companies are buying niche firms to grow in emerging areas such as engineering services. These companies are looking to scale up in high growth areas such as technology-led factories, internet of things (IoT) and software product engineering as their internal capabilities have often not worked, said analysts.

During the past two weeks, these companies have acquired five engineering services and digital technology focused firms, including Wipro’s acquisition of (ITI), Hexaware’s acquisition of Mobiquity for $182 million, and Cognizant buying Zenith Technologies for an undisclosed amount.