Infosys to acquire startup Panaya to automate customer tasks

The company hopes to get more cost-efficient in the delivery of its services by using automation

Indian outsourcer Infosys is to acquire Panaya, a U.S. vendor of automation technology for testing enterprise software deployments and upgrades.

The cash deal values Panaya at an enterprise value of US$200 million, and is in line with the company's strategy under new CEO Vishal Sikka to automate processes, including by using artificial intelligence, to cut down on repetitive tasks and accelerate services delivery.

"This acquisition aims to use automation to boost the revenue of the company without a corresponding increase in staff," said Sudin Apte, CEO and research director at analyst firm Offshore Insights. He pointed out that Infosys' rivals like Tata Consultancy Services already use some degree of automation developed in-house.

Sikka is aiming to turn around Infosys, which saw sluggish growth for a couple of years, both because of problems in execution and a weakened market.

The company is expected to spend a part of its over $5 billion cash reserves in acquisitions in the area of cloud computing, artificial intelligence and big data. Sikka has also expanded the company's venture capital fund from $100 million to $500 million.

In the fourth quarter of 2014, the company's revenue was $2.2 billion, up by 5.6 percent from the same quarter a year earlier. Profit at $522 million grew by nearly 13 percent.

Panaya's cloud-based service cuts down the risk, time and cost required to deliver changes to enterprise software from the likes of SAP and Oracle, by identifying how existing environments will be impacted, telling users what they need to test, and managing the testing plans.

Using Panaya will free Infosys from "the drudgery of many repetitive tasks," Sikka said.

The transaction is expected to close before March 31, subject to customary closing conditions.

Infosys still has other issues to address such as in sales and marketing and customer-facing functions before a complete turnaround, Apte said.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags outsourcingMergers and acquisitionsbusiness issuesservicespanayainfosys

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

John Ribeiro

IDG News Service
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?