Coforge (COFORGE) investor relations material

Strategic rationale and growth outlook

• Acquisition of Encora positions the combined entity as a $2.5 billion tech services powerhouse with a $2 billion core in AI-led engineering, data, and cloud services, targeting accelerated industry-leading growth and value creation.

• Encora brings a strong AI-native platform (AIVA), deep engineering talent, and established relationships with Fortune 1000 and digital-native clients, enhancing capabilities in intelligent process design, agent-native product engineering, and AIOps.

• The deal immediately scales high-tech and healthcare verticals to $170 million each, expands presence in pharma, medtech, and healthtech, and introduces new AI-led healthcare solutions.

• Nearshore delivery in LATAM is significantly strengthened, with over 3,100 engineers, and the US client footprint expands, especially in the West and Midwest, boosting North America revenue by 50% to $1.4 billion.

• The combined firm will have 45 clients with $10 million+ relationships, leveraging a proven track record of cross-selling and upselling to drive further growth.

Transaction structure and financial impact

• The $2.35 billion enterprise value deal is structured as an all-stock transaction, with sellers rolling over into the new entity and no cash consideration, reflecting strong confidence in future prospects.

• Encora shareholders will hold approximately 20%-21% of the combined company on a fully diluted basis, assuming the Cigniti merger proceeds.

• Funding includes $1.89 billion in equity shares and a potential $550 million bridge or term loan (or QIP) to retire Encora’s existing debt; QIP is only one of several options and may not be triggered.

• The agreed share price is $18.15, an 8.5% premium to the current close; regulatory approvals and closing are expected within 4-6 months.

• Encora’s FY26 estimated revenue is $600 million with a 19% adjusted EBITDA margin; the combined business is expected to operate at a 14% EBIT margin post-amortization, with the deal projected to be EPS accretive.

Synergies, integration, and leadership

• Significant revenue synergies are anticipated from cross-selling Coforge’s broader service lines to Encora’s clients and vice versa, especially leveraging Encora’s AI-led engineering in Coforge’s base.

• Cost synergies are expected from G&A, S&M, and operational efficiencies, with only modest margin improvement assumed due to Encora’s already strong profile.

• Leadership retention will follow Coforge’s proven playbook, with retention structures including stocks and bonuses; specifics will be finalized post-regulatory approvals.

• Two Advent representatives will join the Board, bringing additional expertise and potential access to Advent’s portfolio companies for further growth opportunities.

• No performance-linked consideration or special lock-ins beyond statutory requirements for incoming shareholders; client concentration and revenue per employee metrics are healthy and diversified.