Tata Consultancy Services (TCS), India's largest IT service provider, is acquiring Postbank Systems AG from Deutsche Bank AG. The deal value was not disclosed.
Postbank Systems AG provides IT services to Deutsche Bank. TCS will acquire 100% of the shares of Postbank Systems and its 1,500 employees will become part of TCS. The technology is based in Germany and will help TCS expand its presence in the region.
Bernd Leukert, Director of Technology, Data and Innovation Officer at Deutsche Bank, said: "As part of our transition to one technology organization, we are consolidating the IT platform for our Postbank consumer banking brand into the Deutsche Bank platform. TCS is already a trusted IT services partner for Deutsche Bank and this strengthens our relationship goes further. We trust TCS to be the ideal owner of the Postbank systems. Through this transaction, we have agreed on a structure that serves the interests of all parties. It provides clarity to Postbank Systems staff and gives them the opportunity to be part of TCS's growth and success story.
Deutsche Bank is an existing client of TCS and runs its Bancs software suite.
"We are delighted to deepen our long-term partnership with Deutsche Bank and to continue to help accelerate digital transformation and to acquire market-specific capabilities in the banking arena," said N G Subramaniam, TCS Chief Operating Officer, and Chief Executive Officer. "We warmly welcome the IT professionals at Postbank Systems to the TCS family and invite them to take advantage of the learning and development opportunities here, and to help write the next chapter of TCS growth in Germany."
The transaction is subject to both parties finalizing more deals by the end of 2020 and is subject to regulatory and government approvals.
Deutsche said in a press release that the deal will result in cost savings of around 120 million euros as part of its previous strategy announcement in July 2019.
The acquisition will also help Deutsche Bank CEO Christian Sewing achieve his goal of job cuts as part of the bank's broader restructuring plan. The bank unveiled a plan last year to cut 18,000 jobs.
The bank had set 2022 as the deadline for migrating the technology to Postbank systems.
TCS has group companies in the past during the economic downturn. During the great financial crisis, an IT service provider completed the acquisition of Citigroup Inc's stake in Citigroup Global Services Ltd for $ 512 million in cash.
TCS made its most recent acquisitions in 2018. It acquired W12 Studios, a London-based digital design studio for an undisclosed sum. It also acquired BridgePoint Group, LLC, a US management consulting firm for an undisclosed sum.
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Source: Economics Times