Coforge Buys Encora for 2 Billion Dollars

Coforge, an Indian IT services provider, has signed a definitive agreement to acquire Encora, a US-based firm that provides artificial intelligence (AI)-driven engineering services, for $2.35 billion.

The transaction, which is subject to customary closing conditions and regulatory approvals, will be funded primarily through a preferential allotment of equity shares valued at about $1.89 billion.

Encora operates at the intersection of artificial intelligence, cloud, and data, with capabilities spanning agent-native product engineering, core modernisation, AI foundations, data readiness, and AIOps.

They have also built one of the industry’s early composable agentic AI platforms, AIVA, and counts AWS, Microsoft, Google, and Snowflake among its key partners.

Encora reported estimated FY26 revenue of $600 million, with an adjusted Ebitda margin of about 19%.

For Coforge, the acquisition significantly accelerates its pivot towards AI-centric growth, with AI-led engineering, data, and cloud services together expected to generate about $2 billion in revenue by FY27.

Within this, AI-led product engineering is expected to scale into a $1.25-billion-plus business, cloud services to around $500 million, and data engineering to more than $250 million.

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The acquisition will also reshape Coforge’s geographic and vertical mix, with hi-tech and healthcare expected to immediately reach material scale, each operating at an annualised revenue run rate of more than $170 million.

The deal gives Coforge a significantly expanded near-shore delivery presence in Latin America, with over 3,100 engineering and AI specialists serving US clients.

In terms of client relationships, the combined firm will have 45 client relationships generating over $10 million each, which is a notable increase.

Coforge CEO and executive director Sudhir Singh called the deal “a defining moment”, saying the acquisition creates a scaled AI-led engineering foundation underpinned by enterprise data and cloud foundations built for AI.

Shweta Jalan, managing partner at Advent, said the transaction reflects Advent’s approach of building category-leading businesses and expressed confidence in Coforge’s ability to scale Encora further.

As the deal is expected to be earnings-per-share accretive in FY27, Coforge’s expanded share capital will be held around 20% by Encora shareholders after completion.