Integration of UK’s Axon with Infosys to be considered after acquisition

August 27th, 2008 - 8:44 pm ICT by IANS  

Chennai, Aug 27 (IANS) IT bellwether Infosys Technologies Wednesday said the process of integrating the UK-based Axon Group with itself would be considered only after the completion of acquisition. “The issue of integrating Axon with Infosys will be considered once we complete the acquisition. Further, the decision to hive off our consultancy business in favour of Axon or other structure will be taken once Infosys gets near total control of Axon,” Infosys chief executive officer and managing director S. Gopalakrishnan told reporters.

According to him, the operating profit margin from the consultancy business will go up after the acquisition.

“We are one of the companies that gives out guidance numbers. Our philosophy is to get good margins in all our business,” Gopalakrishnan said.

At present, Infosys has a profit margin of around 30 percent whereas the British company’s margin is around 15 percent.

He denied reports about counter-offers for Axon and said Infosys has the backing of Axon’s management for acquisition.

Gopalakrishnan added that he did not foresee any backtracking by either side on this issue.

The Bangalore-based Infosys Monday announced its decision to acquire Axon for 407 million pounds ($753 million).

According to Gopalakrishnan, the acquisition would complement Infosys and would not contradict its existing consulting business in Europe.

“The overlap between customers and industry segments are minimal. We see it as an opportunity to cross sell,” he said.

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