Greenwood Village-based Ciber Inc. said Monday that it will purchase Knowledge Systems, a private Indian company, for $2 million, to expand its global reach.
The acquisition of the Bangalore, India-based software services firm will give Ciber 125 employees in India. Ciber, an information technology services company, had been operating in India under a partnership with another company, iGate, before agreeing to purchase Knowledge Systems.
The deal is expected to close next week. It is projected to bring revenues of $2.5 million to $3 million in the first year – a small fraction of the $902 million Ciber generated last year.
The company has offices in 17 countries, employing more than 8,000 people worldwide. Six hundred work in Colorado.
While offshoring technology services to India has come under much scrutiny, for Ciber to have operations there is necessary to remain competitive, president and chief executive Mac Slingerlend said.
“If we don’t offer this service to our clients, we’re at a disadvantage and risk losing clients,” he said. “Doing low-cost development work is critical to us maintaining our client relationships and, in fact, American jobs.”
Ciber lost business in the mid-1990s when the company lost a major client – American Express – because it didn’t do offshore work, Slingerlend said.
“We have consistently been told by our clients that they would be more comfortable with greater Ciber offshore branding and 100 percent ownership of our operations,” Joe Morone, Ciber’s senior vice president responsible for operations in India, said in a statement. “This combination allows us to attract more clients and more than double our current offshore delivery capacity.”
Ciber also has a domestic initiative – “CIBERsites” – with development centers in Oklahoma City and Tampa, Fla., for clients who want low-cost services based in the U.S.
The company’s shares closed down 7 cents to $8.40 in trading Monday on the New York Stock Exchange.
Staff writer Kimberly S. Johnson can be reached at 303-820-1088 or kjohnson@denverpost.com.
