Atos expects to benefit from Syntel’s association with leading companies in the financial, healthcare and retail sectors such as American Express and FedEx, which are Syntel’s top customers. Atos, which has a market value of $15.4 billion, is much larger than Syntel. The French company has been looking for strategic partnerships to broaden its geographic presence and increase the size of its product portfolio.
The acquisition will prove to be beneficial to both Atos and Syntel as both firms provide services to the same industries and both have a presence in several European and North American markets. However, the deal is expected to be financed through debt, and this is a reason for concern among investors.
Syntel will report its second-quarter results by the end of this week, and the company expects revenues of close to $250 million and diluted EPS of $0.49.