Citigroup unit to acquire Israeli IT firm Ness Technologies for $307 million

US banking giant, Citigroup yesterday said that it would acquire information technology service provider Ness Technologies Inc, for about $307 million in cash.

The acquisition is being done by Citigroup's venture capital arm Citi Venture Capital International (CVCI), which will pay Ness $7.75 per share, a 16 per cent premium to yesterday's closing price of Ness on Nasdaq.

Founded in 1999 and based in Tel Aviv, Israel, Ness provides IT and business services and solutions with specialised expertise in software product engineering; and system integration, application development, consulting and software distribution.

With about 7,800 employees, Ness has operations in North America, Europe, Israel and India, has customers in over 20 countries, and has strategic alliances and partnerships with many software and hardware vendors worldwide including Chordiant, EMC Documentum, IBM, Hewlett Packard, Microsoft, Oracle, and SAP.

For 2010, the company reported revenues of $571.8 million.

"Ness is the leader in several segments of the IT services marketplace, serves the most sophisticated global clients and has an outstanding reputation for delivering complex projects. We look forward to working with management, employees and partners of all business units to ensure that Ness becomes even more valuable to its clients and fully leverages the strengths of its global network," said Bob Khanna, CVCI's managing director.

CVCI manages over $7 billion in equity investments and committed capital and operates in Singapore, Mumbai, New Delhi, Hong Kong, London, New York and Santiago. Over the last decade, funds and entities advised by CVCI have invested in business services and IT Services companies in China, the U.S., India, Mexico, and Korea.