Persistent and Nagarro to form AI-led digital powerhouse following takeover offer

Persistent and Nagarro to form AI-led digital powerhouse following takeover offer​

Galaxy Germany Holding SE, a wholly-owned subsidiary of Persistent Systems Limited, announced a voluntary public takeover offer for all outstanding shares in Nagarro SE. The Offer was made at a cash consideration of EUR 81 per share, following the signing of a Business Combination Agreement (BCA) between the parties.

The takeover offer is positioned as a strategic move to create a scaled and globally diversified AI-led digital engineering and enterprise modernization company. Persistent has already held an approximate 21% stake in Nagarro, which is being acquired through a binding share purchase agreement with Lantano Beteiligungen GmbH, the investment vehicle of Nagarro's largest shareholder. Additionally, members of Nagarro's Management Board have declared their intention to accept the Offer and tender their shareholding into the transaction.

The offer presents a significant financial incentive for Nagarro shareholders. The cash offer of EUR 81 per share represents an attractive premium of approximately 140% compared to the undisturbed closing price on June 25, 2026, and about 94% against the three-month volume-weighted average price.

Strategic Rationale and Combined Strengths​

The combination aims to deliver a global leader in AI-led digital engineering with a combined revenue run rate of approximately USD 2.9 billion and over 46,000 employees across more than 40 countries. This integrated entity is designed to support multi-region enterprise clients who require integrated AI, engineering, ERP/CX delivery, data, and cloud capabilities across local and global delivery models.

Persistent Systems Limited contributes its AI-led engineering leadership and North American scale. Nagarro brings European business exposure, complementary verticals, AI expertise, and proficiency in ERP and CX delivery. The two companies complement each other to form a complete end-to-end offering, moving from AI ambition to measurable outcomes.

The combined structure will have a diversified geographic footprint:

• Persistent’s North American business accounts for over USD 1.7 billion, while Nagarro brings over USD 600M in European business.
• After the combination, Persistent’s European revenue share is expected to increase from 9% to 22%.
• The Rest of World revenue proportion is projected to rise from 10% to 16%, with North America accounting for 62%.

Financial and Operational Details​

Nagarro, which is a Munich-headquartered leader in digital engineering, employs around 18,500 people across over 40 countries and reported a total revenue of EUR 1 billion in Calendar Year 2025. Persistent Systems Limited operates with over 27,500 employees in 21 countries and achieved approximately USD 1.7 billion in revenue in the last fiscal year, representing 17.4% year-on-year growth.

The combined entity will aim to boost the Total Addressable Market (TAM) to over USD 1,400 billion. The organization possesses a deep client franchise, including more than 350 marquee client relationships. These include four of Europe's top five automotive manufacturers, seven of the top 10 US and Indian banks, and eight of the top 15 healthcare and life sciences companies.

Persistent plans to fund the transaction with committed financing from Barclays, expecting leverage to remain within conservative limits for meaningful reduction over a two-year period post-consummation.

Offer Conditions and Future Plans​

The takeover offer is conditional upon achieving a minimum acceptance threshold of 50% plus one share of all outstanding Nagarro shares. This calculation includes the shares acquired through the binding purchase agreement with Lantano and the committed tender of shares by members of Nagarro's Management Board.

The transaction is designed as part of a taking-private strategy. Following the completion of the Offer, Persistent intends to pursue the delisting of Nagarro shares from the regulated market (Prime Standard) of the Frankfurt Stock Exchange, which will be pursued as soon as legally feasible and in alignment with the Nagarro Management Board.

The offer is expected to be launched following approval of the offer document by BaFin, with closing anticipated in Q4 CY26 or Q1 CY27, subject to regulatory approvals and other customary conditions. Persistent has clarified that it does not intend to enter into a domination and/or profit and loss transfer agreement (DPLTA) for two years after the transaction closes.

PERSISTENT Stock Price Movement​

Shares of Persistent Systems Limited on Thursday slipped by 1.66% to close at ₹4,841.50. The stock saw a trading volume of 383,578 shares during the session.