EXCLUSIVE – Tarun Upadhyay, Co-Founder Of GlobalLogic, Talks About Its Acquisition By Apax

Recently, GlobalLogic, an IT outsourcing firm that was started by 4 IIT graduates, was acquired by Apax for a sum of $ 420 million. We had an exclusive chat with Tarun Updhyay, Co-Founder of Globallogic about the new deal and what is in store. Here is what he had to say:

Why did you take the decision to go for a buyout deal instead of raising additional funding?
It has been done from the perspective of long-term shareholder interest. It made more sense to go for a buyout.

Is there any specific reason to bring in Apax as partners? Will GlobalLogic operate as a separate entity post acquisition or will it be a part of iGate?
Along with the stellar reputation of Apax, they had two specific things going for them. One, they are not focused on a particular country but are a global fund. Two, they prefer long-term investments with a growth focus. That made the Apax deal a great win-win for all parties involved.

I expect GlobalLogic will continue to operate as a separate entity for the foreseeable future.

Is it going to be one of the biggest exits for VC investors in India? What’s you take on this?
Indian entrepreneurs have finally started to get their share of large, successful exits. This trend is only going to grow. There are many small and large Indian-owned companies that are focused on global markets. So we should see many more large exits from India-based and Indian-owned companies.

Three of GlobalLogic founders including me are now focusing on our new start-up hCentive, which is already valued upwards of $125 million.

Why did you discard the IPO plan in the first place?
The IPO market has its own complexities, especially for such a diverse and global operation as GlobalLogic. It made more sense to find one buyer at this stage, rather than go for the public markets.

How will the acquisition benefit GlobalLogic?
GlobalLogic will benefit from the global presence of Apax and their vast portfolio across various industries. We anticipate that the company will continue to grow.

How do you view the global market for software development outsourcing? Does India still hold a key position in this space?
Software development outsourcing industry in India will continue to grow, although the margins will come under more pressure.

The large pool of trained and globally exposed IT professionals is finally leading to a sea of change in the industry mindset. Many more of the upcoming companies are now building interesting, innovative products that target the worldwide market. That is the real opportunity.

The next worldwide software success may come from India!

We are sure it is a bit early to ask, but has an Indian or global roadmap been decided? Can you shed some light on it?
It is certainly too early for a new roadmap. It might take some time for things to evolve.