IT and BPO services provider iGATE Corporation has decided to divest its Professional Services business. The divestiture will occur through a sale of the business or through a tax-free spin-off of the business to iGATE shareholders.
Commenting on the divestiture, Sunil Wadhwani and Ashok Trivedi, co-founders of iGATE, said: "This separation is a logical next step for the company. Our board has reviewed the divestiture and believes it will benefit our shareholders, employees and customers."They pointed out that the Global Solutions and Professional Services businesses operate in different markets with varied business models.
"The divestiture will better position each business to benefit from their growth opportunities. In addition, the shareholders of iGATE will benefit from the increased clarity of being a focused offshore services company. The demand for offshore IT and BPO services continues to grow at a rapid rate," they added.
In accordance with generally accepted accounting principles (GAAP), the company's historical and future financial results will now reflect the Professional Services business as discontinued operations, effective beginning as of January 1, 2008.iGATE has retained Credit Suisse Securities (USA) LLC to assist with the divestiture.
Read more in The Business Standard article.
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