The initial agreement covers Ernst & Young Consulting
businesses in the United States, Canada, United Kingdom,
Germany, France, Spain and Italy.
It is expected that the Ernst & Young Consulting
businesses in many other countries will join in
the next few weeks, including those in Sweden, Norway,
Finland, Denmark, the Netherlands, Belgium, Australia
and New Zealand.
Around 18,000 people work for Ernst & Young,
which had a turnover of 3.5 billion euros ($3.2 billion)
Cap Gemini said the transaction would enable the combined
group become a major player in the U.S., strengthen its
position in Germany, and greatly expand its consultancy
To pay for the acquisition, Cap Gemini will issue a
maximum of 43.5 million new shares and pay 375 million
euros ($360 million).
Cap Gemini’s clients include Tesco, ICI, Corus, and
Philips. Ernst & Young brings such heavyweights
as Boeing, Coca Cola, Infoseek.com, GlaxoWellcome
and the Ford Motor Company.
Cap Gemini’s shares rose by 14 percent in Paris when
the news became known early Tuesday morning.