Strategic Acquisition
Persistent and Nagarro Sign Business Combination Agreement to Form the Persistent–Nagarro Group, a Global Leader in AI-led Digital Engineering
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Persistent Systems Limited has signed a Business Combination Agreement to acquire Nagarro SE through a voluntary public takeover offer at EUR 81 per share. The transaction aims to create a global AI-led digital engineering leader with an estimated USD 2.9 billion revenue run-rate, over 46,000 employees, stronger North American and European presence, and expanded enterprise capabilities across AI, engineering, ERP, CX, cloud and data services. The transaction remains subject to regulatory approvals and shareholder acceptance.
PRICE-SENSITIVE TRIGGER
Event: Persistent Systems signs a Business Combination Agreement with Nagarro and announces a voluntary public takeover offer for all outstanding Nagarro shares.
Type: Strategic Acquisition
Impact: Positive
Immediate Effect: The acquisition is expected to strengthen Persistent’s global scale, expand its European footprint, and enhance its AI engineering capabilities. The combined entity would have approximately USD 2.9 billion in revenue and operations across 40+ countries.
Key Metrics:
- Offer Price: EUR 81 per Nagarro share
- Premium to June 25, 2026 Closing Price: Approximately 140%
- Premium to 3-Month VWAP: Approximately 94%
- Existing Stake Secured: Approximately 21% of Nagarro
- Combined Revenue Run Rate: Approximately USD 2.9 Billion
- Persistent FY26 Revenue: Approximately USD 1.7 Billion
- Nagarro CY25 Revenue: Approximately EUR 1 Billion
- Combined Workforce: More than 46,000 employees
- Countries of Operation: 40+
- North America Revenue Contribution (Post Combination): Approximately 62%
- European Revenue Share (Persistent): Expected to increase from 9% to 22%
Highlight:
- Strategic Scale Creation: The proposed combination positions Persistent as one of the largest AI-led digital engineering companies globally with substantially expanded geographic reach, customer base, and technology capabilities.
What Happened ?
Persistent Systems announced that its wholly-owned subsidiary, Galaxy Germany Holding SE, will launch a voluntary public takeover offer for Nagarro SE after signing a Business Combination Agreement with the German technology company.
The offer proposes an all-cash consideration of EUR 81 per share for every outstanding Nagarro share.
The announcement also confirms that:
- Persistent has already secured approximately 21% ownership in Nagarro through a binding agreement with Nagarro’s largest shareholder.
- Members of Nagarro’s Management Board have indicated their intention to tender their personal shareholdings into the offer.
- Nagarro’s Management Board and Supervisory Board support the proposed transaction and intend to recommend shareholder acceptance after reviewing the official offer document.
According to the company, the combination is intended to create a globally diversified AI-led engineering platform capable of delivering end-to-end digital transformation services across North America, Europe, and other international markets.
The merged organization will integrate Persistent’s strengths in AI engineering, cloud modernization, enterprise platforms, and North American client relationships with Nagarro’s deep European presence, ERP capabilities, customer experience expertise, and digital engineering talent.
Management believes the enlarged organization will be better positioned to execute large-scale AI transformation programs for global enterprises while strengthening competitiveness across multiple industry verticals including banking, healthcare, industrial manufacturing, technology, media, telecommunications, and consumer sectors.
Key Details
Strategic Highlights:
- Persistent Systems has entered into a Business Combination Agreement with Nagarro to create a larger AI-led digital engineering company with global delivery capabilities.
- The voluntary takeover offer values Nagarro at EUR 81 per share, representing a premium of approximately 140% over its undisturbed closing price on June 25, 2026.
- Persistent has already secured an approximately 21% stake in Nagarro through a binding agreement with the company’s largest shareholder.
- Nagarro’s Management Board and Supervisory Board have expressed support for the transaction and intend to recommend the offer to shareholders after reviewing the official offer document.
- The combined company is expected to generate around USD 2.9 billion in annual revenue and employ more than 46,000 professionals across 40+ countries.
- Persistent expects its European revenue contribution to increase from 9% to 22%, creating a more geographically balanced business.
- The transaction will be financed through committed funding from Barclays while maintaining a conservative leverage profile with a planned reduction over the following two years.
- Closing is targeted for Q4 CY2026 or Q1 CY2027, subject to shareholder acceptance, regulatory approvals, and other customary conditions.
Why It Matters:
- The acquisition significantly expands Persistent’s scale in Europe while strengthening its capabilities across AI, digital engineering, ERP, customer experience, cloud, and enterprise modernization. The combined platform is expected to improve its ability to serve multinational clients seeking integrated technology transformation services.
Business Impact:
- The combination broadens Persistent’s industry exposure by strengthening its presence across banking, healthcare, industrial manufacturing, consumer, and technology sectors. A larger global client base and enhanced delivery capabilities are expected to improve long-term revenue visibility and competitiveness.
Operational Implications:
- The merged entity will operate with an expanded global workforce and delivery network across more than 40 countries. Persistent also intends to preserve Nagarro’s leadership structure, engineering culture, and employee commitments while integrating operations over time.
Note:
- The proposed transaction remains subject to regulatory approvals, minimum shareholder acceptance thresholds, and completion of customary closing conditions before becoming effective.
Risk Analysis
Summary:
- The transaction remains subject to regulatory approvals, shareholder acceptance, and other customary closing conditions. Until these requirements are fulfilled, there is no certainty regarding the successful completion of the proposed business combination.
Key Points:
- The offer requires acceptance of at least 50% plus one share of Nagarro’s outstanding shares.
- Regulatory approvals from the relevant authorities are pending.
- Integration of two large global organizations may involve execution and operational challenges.
- Delays in approvals could postpone the expected closing timeline.
Worst Case:
- Failure to obtain the required approvals or shareholder acceptance could result in the transaction not being completed.
Risk Level: Medium
Company Commentary
- Persistent Chairman and Managing Director Dr. Anand Deshpande said the partnership is built on shared engineering values, innovation, and long-term client relationships. He believes the combination will strengthen the company’s ability to support enterprises in the rapidly evolving AI landscape.
- CEO Sandeep Kalra stated that the transaction represents a major milestone in Persistent’s global growth strategy, enhancing its presence in Europe, expanding AI capabilities, and creating greater value for clients, employees, and shareholders.
- Nagarro’s management also expressed support for the proposed combination, highlighting the strategic fit, complementary capabilities, and the opportunity to deliver large-scale AI transformation programs across global markets.
Official Exchange Filing: Persistent Systems Limited
