BENGALURU: IT major Coforge Ltd has secured loans worth $550 million (around Rs 5,156 crore) from a group of global banks to support its acquisition of digital services firm Encora.
In an exchange filing, the company said the loans have been arranged through JPMorgan Chase, Bank of America, Citibank, HSBC, and BNP Paribas. The loan carries an interest rate of 4.6% and has a tenure of three years.
As part of the acquisition deal, Coforge has allotted 9.37 crore shares to Encora’s sellers on a preferential basis, priced at Rs 1,815.91 per share.
Following the loan arrangement, the company said it has cancelled its earlier plan to raise funds through a Qualified Institutional Placement (QIP), which would have led to further dilution of equity.
Coforge had announced in December last year that it would acquire a 100% stake in Encora, a US-based firm, at an enterprise value of $2.5 billion. The company had said at the time that the deal would be funded through $1.89 billion in equity, with the remaining amount to be financed through a bridge loan or a QIP to retire Encora Group’s term loan.
The company confirmed that Encora’s financials will be consolidated into Coforge starting May 1, 2026. Its financial results for FY27 are expected to reflect eleven months of contribution from Encora’s operations.
“The firm is pleased to share that the integration activities related to Encora’s integration into Coforge are ahead of plan, with the combined cost synergies on G&A expected to be between 20 – 25%.” the company said.
Coforge said the acquisition is expected to strengthen its position by expanding its nearshore delivery capabilities in Latin America, supported by an engineering and AI talent base serving clients in the United States.
The combined entity is expected to have 45 client relationships valued at over $10 million each. The company added that its AI-led engineering, data, and cloud services could together generate about $2 billion in revenue in FY27.