Employees at IGate seem to welcome Capgemini's move to buy their company, hoping it to smooth out the operational inefficiencies that had crept in after its previous deal, as the French acquirer is likely to bring better opportunities and greater exposure for them.
For IGate employees, this is the second acquisition-related transition in four years. In 2011, IGate bought its then bigger rival Patni Computer Systems in partnership with private-equity giant Apax Partners for $1.2 billion.
That had brought in scale, but also discomfiture for some people who moved in from Patni and alleged discrimination in promotions. Employees and industry experts that ET spoke to say once the French IT services firm completes IGate's acquisition, such issues would also subside.
For employees, the greatest comfort is that there are no job cuts.
A Pune-based employee remembers the company before the Patni acquisition as a small set up, which was trying to compete with the larger players. "IGate had good employee policies, but until 2009-10 it was still developing as an IT services firm. They had a few good projects where they were very particular about hiring, but were not very stringent about enforcing rules within the organization," this employee said.
Several Patni employees were unhappy with the way the transition was handled, saying IGate favoured its own employees over those who came from Patni. "They had sort of an auto promotion for IGate employees who were software engineers and had worked for one year. People working for three-four years (at Patni) were left high and dry. At Patni, we had a proper promotion and appraisal process, which included exams and training," said a person who moved to IGate via the Patni acquisition and left the company a month ago.
Experts see the Capgemini acquisition as a good move for IGate employees. "Although this is the second deal in very rapid succession happening, this one would be fairly settling for the employees because the previous shareholders were private-equity funds, who are tenured funds who will anyway look for an exit at some point," said Ajit Isaac, chairman, Quess.
"We may get more opportunities to work across projects and locations," said a Mumbai-based IGate employee. "Being comparatively smaller, IGate becomes restrictive at times," the person said. "However, we also came to know of the development today, so we are also unaware of the changes that may happen."
Isaac said only non-optimal resources would be asked to leave. "I have no reason to believe they will let go of people unless they're not performing. Some of the uncertainties of the IT industry can be dealt better with greater scale and Capgemini adds this to the transaction," he added.