HCL Axon acquires UCS Group's enterprise software business

HCL Technologies' business transformation consultancy HCL Axon, the world's largest SAP implementation service provider, has acquired South Africa's top retail industry-focused software solutions provider UCS Group's enterprise solutions SAP practice. The effective date of this transaction is 1st August 2009.

Axon is paying an initial $7.7 million in cash and performance-related payments over the next two years for meeting revenue targets, that could take the acquisition cost to $18.5 million.

The UCS Group is a group of IT businesses focused on the manufacturing of software and the provision of software solutions and outsourcing services in the retail market and other niche markets. Customers include the leading apparel, furniture,  fuel / forecourt, food and speciality retailers and quick service restaurants.

In September 2008 HCL put in a counter bid to acquire British consulting firm Axon Group, with $785-million bid, that edged out Indian rival Infosys' $753 million offer, edging out Infosys  (See: Infosys to acquire UK's Axon for $753 million),  to boost its own enterprise-software capabilities. HCL integrated Axon with its enterprise-software business.

After resisting HCL Technologies' advances for the last two years, Axon finally agreed to the bid by HCL, rejecting Infosys offer of $753.1 million.

The acquisition will strengthened HCL Axon's SAP capabilities with best-in-class SAP retail industry solutions (IS), will bring proven competency in IS retail and further increase the global delivery capabilities, including a significant boost to the company's market presence in South Africa.