The country’s top IT exporter Tata Consultancy Services (TCS) has bagged a $2.25 billion outsourcing contract from Nielsen, a television rating measurement firm. The deal is reportedly the biggest ever outsourcing deal for an Indian IT firm.
The partnership, signed in October this year, is a renewal of TCS’ existing collaboration with Nielsen. The two companies had struck a 10-year deal in 2008 for $1.2 billion, which was expanded to $2.5 billion in 2013. The latest deal, however, brings cheer to the Mumbai-based IT behemoth as it assures $320 million worth of business annually in the 2017-2020 period.
Prospective annual revenue from 2021 till 2024 is being seen at $186 million, and at $139.5 million in 2025. Under the new deal, the terms of the agreement have been extended for an additional five years so as to expire on December 31, 2025, with three one-year renewal options granted to Nielsen, the TV rating company said in a regulatory filing to the US SEC.
“Nielsen has committed to purchase services from TCS from the Effective Date through the remaining term of the Agreement (the ‘Minimum Commitment’) in the amount of USD 2.25 billion, including a commitment to purchase at least $320 million in services per year from 2017 through 2020, $186 million in services per year from 2021 through 2024, and $139.5 million in services in 2025,” it added.
Briefing on the services to be provided by TCS , the filing detailed, “TCS will globally provide Nielsen with professional services relating to information technology (including application development and maintenance), business process outsourcing, client service knowledge process outsourcing, management sciences, analytics, and financial planning.”
Following the deal, the IT giant TCS’ scrip surged on the NSE by almost 1.50 per cent. At 11.55 am, the broader market in comparison, was up about half a per cent.