Outsourcer plans to launch group dedicated to Azure and Microsoft 365 after it buys specialist New Signature
IT outsourcer Cognizant plans to use the upcoming acquisition of New Signature as the foundation of a new dedicated business group focused on cloud solutions from Microsoft.
The Lowdown: Officials with the Teaneck, New Jersey-based company this week announced it’s buying New Signature, a specialist in helping enterprises transition to Microsoft’s public clouds. The deal is expected to close in the third quarter. No financial details were disclosed.
The Details: New Signature has an integrated offering that spans all three of Microsoft’s business clouds – Azure, Microsoft 365, and Dynamics 365 for enterprise resource management (ERP) and customer relationship management (CRM) applications. Cognizant plans to fold the more than 500 cloud experts at New Signature in the United States, the U.K., and Canada into its newly formed Microsoft Business Group.
New Signature, one of 70 certified Azure Expert Managed Service Providers in the world, counts companies in an array of industries, government institutions, and non-profit groups among its customers. Projects have included a cloud migration effort for Virgin Atlantic Airways, an Internet of Things (IoT) solution for The Hershey Company, and an effort to map all public defibrillators in the U.K. for the National Service and British Heart Foundation.
The Impact: Cognizant is rapidly building out its cloud capabilities in part through acquisitions. The New Signature deal will be the latest cloud-related acquisition this year, following the purchase of such companies as Code Zero Consulting (for cloud-based quote and billing solutions), El-Technologies (a Salesforce specialist), and Collaborative Solutions (Workday enterprise cloud applications).
Microsoft continues to run behind Amazon Web Services (AWS) in the fast-growing public cloud market. According to Synergy Research Group, Microsoft Azure at the end of last year held 18% of the market, while AWS dominated with a 33% share. However, Microsoft grew at a faster rate than the overall market, the analysts said.
Background: Cognizant is coming off a second quarter that saw its financial numbers impacted not only by the coronavirus pandemic but also by a ransomware attack in April from the high-profile Maze cybercriminal group. The $17 billion company this week said that its second-quarter net profit fell 29% year-over-year, from $509 million to $361 million. Revenue fell 3.4% to $4 billion.
The Buzz: “The pace of cloud adoption continues to accelerate across industries, with Microsoft’s cloud solutions among the preferred technologies to help transform and strengthen businesses,” said Greg Hyttenrauch, president of Cognizant Digital Systems and Technology. “Acquiring New Signature will enrich our cloud-first capabilities and complement our increasing strengths as a Microsoft partner. We look forward to welcoming New Signature into the Cognizant family.”
“New Signature’s success is built upon helping clients create and accelerate their business transformation through the adoption of Microsoft cloud technologies,” New Signature CEO Jeff Tench said. “In joining Cognizant, we will have access to Cognizant’s deep industry expertise and global scale, and together, provide best-in-class cloud solutions for the intelligent workplace, applied innovation, and managed services. We share a passion for innovation and look forward to our future at the heart of Cognizant’s new Microsoft Business Group.”
“The New Signature acquisition will enhance Cognizant’s ability to partner with customers across industries and geographies on their cloud strategy and business transformation,” said Judson Althoff, executive vice president of Microsoft’s Worldwide Commercial Business. “We look forward to building on our long-standing partnership with Cognizant, especially with the coming launch of Cognizant’s new Microsoft Business Group.”