HCLTech to buy HPE communications technology group assets for $225 million

HCLTech Ltd announced its plan to acquire Communications Technology Group (CTG) assets from Hewlett Packard Enterprise (HPE) for $225 million (approximately ₹1,874 crore) in an all-cash transaction. As part of this deal, about 1,500 CTG employees with expertise in the telecom sector will transition to HCLTech across various countries, including Spain, Italy, India, Japan, and China, to serve global clients.

HCLTech stated in a regulatory filing that this acquisition would provide them with leading intellectual property (IP), engineering and research and development talent, as well as client relationships with major global Communication Service Providers (CSPs). This move aims to enhance HCLTech’s position in the telecom sector by expanding its engineering services and utilizing CTG’s IP, solutions, and talent to better serve top CSPs across Europe, Japan, the Americas, and the APAC region, including 20 of the top 30 CSPs globally.

HPE will retain the portion of its former CTG business that focuses on Operations Support Systems (OSS). This segment, which is part of HPE Aruba Networking, specializes in OSS, orchestration, assurance, public 5G Subscriber Data Management (SDM), and private 5G networking, and will continue to provide value to HPE’s telecom customers and partners.

HCLTech’s CEO and Managing Director, C Vijayakumar, commented that the acquisition and the strategic partnership with HPE would bolster their telecom practice, enabling them to meet the growing and evolving demands of the global telecom market. He emphasized the addition of top-tier engineering talent and industry-leading IP from CTG, which would enhance HCLTech’s capabilities and direct relationships with global CSPs.

HPE President and CEO Antonio Neri remarked that the integration of CTG into HCLTech would position the group within a robust partnership that values the heritage and future potential of the CTG business.

The completion of this transaction is contingent on regulatory approvals and customary closing conditions, and is expected to finalize within 6 to 9 months.

On the stock market, shares of HCL Technologies Ltd closed at ₹1,353.40, marking an increase of ₹10.30 or 0.77% on the BSE.