Cognizant to acquire Belcan for approximately $1.3B in cash and stock

Cognizant announced it has signed a definitive agreement to acquire Belcan, a portfolio company of AE Industrial Partners and a leading global supplier of Engineering Research & Development services, at a purchase price of approximately $1.3B in cash and stock, subject to customary adjustments. Belcan is an established player in ER&D that provides mission-critical digital engineering services for a long-standing customer base across the commercial aerospace, defense, space, marine and industrial verticals, primarily in North America and the United Kingdom. The revenue the acquired business will contribute to Cognizant in 2024 depends on the timing of the close but is expected to be over $800M on an annualized basis. Revenue from the acquired business has grown at an 8% compound annual growth rate over the last two years. The transaction is anticipated to close in the quarter ending September 30th, 2024, subject to the receipt of required regulatory approvals and other closing conditions. The total purchase price of approximately $1.29B, subject to customary adjustments, comprises $1.19B in cash consideration and a fixed 1.47M Cognizant shares, with a current value of $97M based on Cognizant’s closing share price on Friday, June 7, 2024. The cash consideration is expected to be funded through a mix of cash on hand and debt. Cognizant intends to increase its share repurchase plan to maintain current share count guidance of 497M for the full year 2024.