Wipro, a Bangalore-based IT services firm, announced today that it has signed an agreement to fork over $500 million to acquire Appirio, an Indianapolis-based cloud services company.
Established in 2006, Appirio has more than 1,200 employees spread across five global offices and counts Coca-Cola, Facebook, and Home Depot among its customers. According to an article in Fortune, Appirio was early to the software-as-a-service (SaaS) realm, and that’s what piqued Wipro’s interest.
In the old days, before the rise of SaaS, Fortune points out, most companies bought software to run in-house, which made them responsible for managing hardware and software upgrades. Under the SaaS model, software is distributed over the Internet, removing the pain of upgrades. Not surprisingly, many business customers now buy their software this way—and for legacy IT companies like Wipro that want to cash in on the SaaS sector, that requires the adoption of new sales and support processes.
The acquisition is expected to be finalized by the end of the year. There’s no word yet on the status of Appirio’s employees or the company’s Indianapolis headquarters.
