Wipro wins 10-year, $1.6 billion Alight deal, its biggest ever
BENGALURU:Wipro Ltd has won the largest ever information technology (IT) outsourcing deal valued at $1.6 billion from Alight Solutions, the former benefits administration and human-resources outsourcing business of Aon Plc. Under the 10-year contract, Wipro will provide a comprehensive suite of solution services to the US-based company.
Starting next year, the India IT major is assured of at least $150 million in annual revenue. The deal is a shot in the arm for Abidali Neemuchwala, who since taking over as chief executive officer in February 2016, has been trying to put the Bengaluru-based company back on growth path.
Mint first reported about the mega deal (more than $1 billion) win by Wipro on July 23, when the two companies were in the final stages of closing the deal.
“For now, Wipro and Alight are in final stages of closing this partnership, and the duration of the contract could be extended beyond seven years, depending on the final negotiations currently underway between the two firms,” the Mint report had said.
A 10-year partnership with $150-160 million in annual revenue will translate into $1.5-1.6 billion over the duration of the contract, more than the $1.1 billion order Wipro won from Canadian logistics firm ATCO in June 2014. “We are delighted to be chosen by Alight as their long-term strategic partner in their enterprise transformation journey to bring digital experiences and offerings to employees and employers, globally,” said Neemuchwala.
“This is a testimony to the capabilities we have built through our strategic investments in Wipro Digital, cloud platforms and cognitive platform Wipro Holmes.”
Wipro’s deal win is also significant because most outsourcing deals are shrinking both in value and duration, as firms ranging from banks to retailers cut their budgets to maintain back-end technology and plough the savings into work that can help them improve business operations.
Typically, IT firms take 15-18 months to close outsourcing contracts valued at more than $1 billion, and work on this entire IT outsourcing deal was completed under Neemuchwala’s watch.