Tata Consultancy spots promising model in Porsche

Tata Consultancy Services will buy Porsche AG's automotive and consulting unit MHP at an enterprise value of €320 million, the IT major said on August 24 in a stock exchange filing.

Under the partnership, Porsche has signed a five-year strategic deal with MHP and TCS amounting to €1.25 billion. The deal is expected to close by the end of the year.

TCS has stepped up acquisitions of late, including two U.S. deals last year; expanding its footprint in Europe, which accounts for roughly a third of revenue, looks sensible. This year, it bagged an $800 million AI contract with Swedish manufacturer SKF and launched a sovereign cloud computing service for European governments, public sector enterprises and regulated industries. Deepening ties with the region's industrial groups should help ease reliance on its biggest market by sales, North America. Revenue there grew just 2% last quarter from the same period last year, compared to the 4.3% increase in Continental Europe.