Coforge Limited, a leading global IT solutions provider, has announced the acquisition of Rythmos Inc. and TMLabs Pty Ltd through its subsidiaries. The move is aimed at expanding its capabilities in data, cloud engineering, and the ServiceNow ecosystem, strengthening its foothold in the USA and Australian markets.

Acquisition of Rythmos Inc.

Coforge, through its wholly owned subsidiary Coforge Inc., has entered into a stock purchase agreement with Rythmos Inc., a US-based IT solutions provider specializing in data and cloud services. This acquisition will enable Coforge to enhance its expertise in data management and cloud engineering, particularly in the airline industry, where Rythmos holds significant experience.

• Financial Details:

  • Rythmos Inc. recorded a turnover of $25.3 million (INR 2,204 million) for 2024.
  • The acquisition is valued at $30 million upfront, with a maximum additional earnout of $18.7 million based on revenue and EBITDA performance in 2025 and 2026.
  • The entire transaction will be completed in cash, making it a strategic investment by Coforge.

• Strategic Impact:

  • Strengthens Coforge’s data and cloud capabilities, reinforcing its offerings to global clients.
  • Provides strong industry expertise in airlines, helping Coforge tap into new opportunities in aviation technology.
  • Expands Coforge’s presence in the US market, one of the fastest-growing regions for IT services.

The acquisition is expected to be completed by March 31, 2025, subject to closing conditions.

Acquisition of TMLabs Pty Ltd

In another major move, Coforge has acquired TMLabs Pty Ltd, an Australia-based ServiceNow solutions provider, through its wholly-owned step-down subsidiary, Coforge Technologies Australia Pty Ltd. This acquisition is aimed at strengthening Coforge’s capabilities in Integrated Risk Management, Healthcare, and HR Service Delivery within the ServiceNow ecosystem.

• Financial Details:

  • TMLabs recorded a turnover of AUD 11 million (INR 608 million) for 2024.
  • The acquisition involves an upfront payment of AUD 20 million, with additional earnouts based on financial performance in 2026 and 2027.
  • Coforge will fund the transaction entirely in cash.

• Strategic Impact:

  • Strengthens Coforge’s ServiceNow implementation services, a key area of growth in the IT industry.
  • Enhances Coforge’s expansion in the Australian market, where demand for digital transformation services is rising.
  • Supports Coforge’s focus on Healthcare IT solutions, a priority sector for the company.

The acquisition has received regulatory approvals, including a no-objection clearance from the Australian Treasury (FIRB Approval) issued on February 6, 2025. The deal is expected to close by March 31, 2025.

Coforge’s Growth Strategy and Market Impact

With these acquisitions, Coforge is accelerating its global expansion in high-growth technology areas. The company is focused on enhancing its data, cloud, and ServiceNow capabilities, which are key drivers for digital transformation across industries.

These strategic investments reflect Coforge’s commitment to staying ahead in the IT services market by acquiring niche capabilities and strengthening its presence in key international markets. Investors and stakeholders will be closely watching how these acquisitions translate into revenue growth and enhanced service offerings.

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