Coforge Redefines the Global IT Landscape with a Landmark $2.35 Billion Acquisition of AI Powerhouse Encora

In a move that signals a seismic shift in the Indian IT services sector, Noida-headquartered Coforge Ltd. has announced a definitive agreement to acquire Silicon Valley-based artificial intelligence and digital engineering firm Encora for an enterprise value of $2.35 billion. This acquisition, which stands as one of the largest overseas buyouts by an Indian mid-tier IT company, is designed to propel Coforge into an elite $2.5 billion revenue bracket while establishing a formidable "moat" in AI-led engineering. By integrating Encora’s high-growth digital native capabilities, Coforge is effectively positioning itself to capture the rapidly expanding market for enterprise-grade AI solutions, cloud foundations, and data cores.

The financial architecture of the deal is as ambitious as its strategic intent, structured primarily as an all-stock transaction. Coforge will issue approximately 93.8 million equity shares to Encora’s current stakeholders including private equity titans Advent International and Warburg Pincus representing an equity value of roughly $1.89 billion. This arrangement ensures that the sellers will retain a significant vested interest in the combined entity, collectively holding a 20% to 21% stake in Coforge’s expanded share capital. To streamline the transition, the company’s board has also authorized raising up to $550 million through a bridge loan or a Qualified Institutional Placement to retire Encora’s existing debt, ensuring a clean balance sheet for the new technology powerhouse.

Strategic rationale for the merger centers on a massive expansion of Coforge’s footprint in North America and a dramatic upgrade to its technical arsenal. Pre-acquisition, approximately 25% of Coforge’s North American revenue was concentrated in the U.S. West and Midwest; however, the addition of Encora is expected to surge the company’s regional business by 50%, pushing North American revenues past the $1.4 billion mark. Furthermore, Encora brings with it a robust nearshore delivery model powered by over 3,100 professionals in Latin America, providing Coforge with a crucial geographical advantage to service U.S. clients with high-speed, same-timezone agility.

Beyond geography, the synergy is deeply technical. Encora is renowned for its "AIVA" platform a composable agentic AI framework which allows for the creation of sophisticated, intelligent workflows that go beyond simple automation. Sudhir Singh, CEO and Executive Director of Coforge, described the acquisition as a defining moment that establishes a scaled AI capability purpose-built for the future of enterprise data. By the fiscal year 2027, the company anticipates that its AI-led engineering, data, and cloud services alone will generate nearly $2 billion in revenue, with product engineering contributing the lion's share of approximately $1.25 billion.

The deal also provides immediate scale to Coforge’s HiTech and Healthcare verticals, both of which are now projected to operate at an annualized revenue run rate exceeding $170 million. With Encora adding 11 high-value client relationships each generating over $10 million annually and maintaining an average tenure of over a decade the combined entity will boast a total of 45 such "platinum" accounts. While the transaction is expected to close within four to six months pending regulatory approvals, the market outlook remains focused on the potential for margin expansion, with the combined business expected to maintain a steady 14% EBIT margin even after accounting for the amortization of intangibles. This acquisition not only enhances Coforge’s competitive edge against larger peers but also serves as a bold declaration of India’s maturing role in the global AI-led digital transformation race.