Cognizant to Buy CoreLogic’s India Arm

The $50-m deal to help IT firm expand its mortgage services portfolio

OUR BUREAU CHENNAI

Nasdaq-listed IT firm Cognizant is acquiring CoreLogic Global Services (CoreLogic India), the India-based captive operations of CoreLogic, for $50 million to expand its mortgage services portfolio. The deal also includes adjustments for working capital and other charges or credits which will be determined at the time of closing which is expected in August. This is the fourth captive unit that Cognizant is buying out.
As part of the transaction, CoreLogic and Cognizant will enter into a services agreement with a minimum revenue commitment of $324 million, plus applicable inflation adjustments, over five years with renewal and extension rights, under which Cognizant will provide a range of services to CoreLogic globally. Together, the companies will provide end-to-end solutions across the mortgage value chain, from loan origination, escrow, title and closing services through secondary markets, loan administration, loan default management and analytics.
    IT analysts say the acquisition will give Cognizant a greater presence in the analytics space, an area with high growth prospects.“Around 42% of our revenues come from financial services and this would be an added capability for us. This acquisition also strengthens Cognizant’s BPO and analytics capabilities and provides end-to-end expertise in the mortgage industry,” R Chandrasekaran, president and MD, Global Delivery, Cognizant told ET.
He said Cognizant will also look at more areas to increase non-linear revenues. After the deal is closed, CoreLogic India’s 4,000 associates (2,000 in Bangalore, 1,200 in Hyderabad and 800 in Mangalore) will become employees of Cognizant. “There are no overlapping functions. So, the employees will not have any issues during transit,” he said. Headquartered in Santa Ana, California, CoreLogic has more than 10,000 employees globally with 2010 revenues of $1.6 billion. Its customers are mainly in the US mortgage and real estate markets.