In its race to hit the $2 billion revenue target this fiscal, Noida-headquartered IT mid-cap firm Coforge has announced the acquisition of California-based digital product and engineering firm Encora for $2.35 billion. Encora, a product engineering firm that provides outsourced software product development services (OPD) to other software vendors with a large US client base, will plug in much of Coforge’s ambition in AI, data, and cloud and product engineering space. 

“The Encora acquisition is a defining moment for our organization. It establishes a scaled AI-led engineering capability moat for the firm underpinned by capabilities to help create enterprise data cores and cloud foundations purpose-built for AI. The new $2.5 billion firm, with a $2 billion enterprise core of AI-led Engineering, Data, and Cloud services, will set the benchmark on making the promise of AI real for enterprises,” said Sudhir Singh, Chief Executive Officer and Executive Director, Coforge Ltd, in a statement.

The deal construct of the acquisition will see Coforge allotting preferential equity shares to Encora investors, such as Advent, Warburg Pincus, and other minority shareholders, for a value of $1.89 billion, who, in turn, will form a fifth of the company’s shareholders on the completion of the transaction. With the regulatory approvals expected to close within 6 months of signing, Coforge has also assumed the responsibility of retiring a $550 million term loan of Encora as part of the deal. 

In the combined entity, Encora Investors gets the right to appointment of 2 nominee Directors on the Board, 1 nominee on the nomination and remuneration committee, and 1 nominee on the audit committee of the Company. In the preceding two fiscals, Encora’s consolidated turnover stood at $481Mn (FY24) and US$516Mn (FY25), respectively, and in FY26, it’s revenue is estimated to be $600Mn at an EBITDA of 19%. The combined business is expected to operate at an EBIT margin of 14% and the acquisition is expected to be EPS accretive in FY27. “Over the last eight years, Coforge has delivered industry-leading growth on the back of its execution excellence, hyperspecialized industry expertise, and a perfect track record of making every acquisition very successful. With this augmented enterprise AI-led engineering core, we believe that our growth will be further accelerated and move to an even higher orbit,” Singh further added.