KPIT Technologies Stock Surges. After Acquiring Technica Engineering For 80 Million Euro

IT sector has fallen sharply from earlier this year, and unlike other sectors, it is not showing any signs of a trend reversal. Most IT stocks with good fundamentals are soaring rapidly. However, KPIT Technologies (KPIT), a mid-cap stock from the IT sector, has shown a strong upside over the past few weeks. On September 21, 2022, the stock surged up to 4.5% in one trading session after the announcement of KPIT Technologies acquiring 4 Technica Group companies.

Recently KPIT Technologies mentioned in an announcement that its board had approved acquisitions of 4 companies of Technica Group for over 640 Crores or 80 Million Euros. The amount of the deal has to be paid over 6 months, and after the settlement of the amount, Tehnica group will be owned by KPIT Technologies.

A document attached with the latest announcement to Bombay Stock Exchange KPIT Technologies mentioned, "The deal is expected to be closed by the end of October 2022, post fulfillment of customary closing conditions, and at the end of it, Technica Engineering will be fully owned by KPIT Technologies. The deal will be EPS accretive upon consolidation."

The acquisition is mainly for accelerating the transformation toward Software-Defined Vehicles. For acquiring Technica Group, KPIT mentioned, "KPITs' extensive software expertise gets vertically integrated with Technica Engineerings' production-ready system prototyping specialization making it a game changer for the industry."

On Acquisition, Mr Joseba Rodriguez Martinez, CEO of Technica Engineering, said, "For the last 14 years, Technica has built a team passionate about cutting-edge tech in network architecture and system prototyping. A partner with a vision and value match was crucial to scale and create leadership in this space. We are delighted to find that in KPIT. We are confident that together we will play a key role in shaping the future of the mobility industry."