What Is The Key Acquisition Made By My Mid Term Company In The Industry

Key Acquisition made by my Mid Term Company in the Industry
My midterm company Cognizant based in the IT services industry grew to fame during the 2000’s and has been since growing rapidly and during 2015 it was one of the top 5 in the Fortune 500 list of companies. As I discussed about its revenue growth in the previous assignment a major source of the revenue hike comes from Healthcare space. They have been targeting the healthcare systems which contributed to nearly 30% of the total revenue in the 2014. A lot of it I believe is attributed to Cognizant’s acquisitions in the past years especially the past decade after it got on the radar. Cognizant has thus completed over 23 acquisitions since 2002 the first of which is a healthcare firm

During 2014, Cognizant announced that they would be acquiring TriZetto Corporation, an IT service solutions firm that offers healthcare IT solutions to payers and providers and assist in enhancing the healthcare administrations, for 2.7 billion dollars in cash and the acquisition was financed by both cash on book as well as debt. This acquisition was made to gain more growth into the ever evolving healthcare space and would also accelerate the market position in the healthcare segment. They predicted that this acquisition would offer a potential revenue synergies in excess of 1.5 billion dollars over the next 5 years and also accrue nonlinear software revenue. The client strength of Trizetto extended to more than 200 and an employee strength of around 3,700. After the acquisition Trizetto were to work as a stand-alone business within Cognizant’s already stemmed healthcare business. This acquisition I believe is the most significant acquisition made by Cognizant and also for the target company Trizetto as it introduced a new found stability by overcoming the target company’s future ownership concerns and Cognizant’s additional resources was a big plus to Trizetto although it did not truncate other ongoing problems immediately but over

Talking about the Integration of the companies it would probably take some while which might pose an increased business risk to Trizetto clients. Overall this acquisition provided the much needed resources and improved direction to the faltering healthcare provider. Added perk is the fact that both Cognizant and Trizetto were spun out of Dun and Bradstreet which were from the same soil so they basically had to reintegrate the usual and power their way to the top of the service companies and now that they have got both service and product they are destined to achieve more in the coming future. This acquisition is considered to be the biggest deal struck by Cognizant and the results spoke for themselves as the Cognizant shares increased by 7%. However amidst all the pros of this acquisition they were in for some shock as Syntel ,an US based competitor sued Cognizant and Trizetto for allegedly interfering with a contract and misappropriating confidential information and denied to pay Syntel a great deal of amount owed over some terms and conditions. Syntel is seeking 6.1$ billion in punitive damage that is based on