Infosys to acquire US-based Kaleidoscope Innovation for up to $42M
India's second-largest IT services firm Infosys on Thursday said it will acquire US-based product design and development firm Kaleidoscope Innovation for up to $42 million (about Rs 308 crore).
Kaleidoscope Innovation is a full-spectrum product design, development and insights firm innovating across medical, consumer and industrial markets.
It designs microsurgical instruments, devices used in minimally invasive surgery, drug delivery devices for ophthalmic therapies, and user-centric wearables.
It also offers usability testing in support of regulatory submissions, including the delivery mechanism for aortic stents.
In a regulatory filing, Infosys said the cost of acquisition is "up to $42 million including earn-out, management incentives and bonuses."
The acquisition by Infosys Nova Holdings, LLC (a wholly-owned subsidiary of Infosys) is expected to close during the second quarter of FY 2021, subject to customary closing conditions, it added.
Ohio-based Kaleidoscope had clocked revenue of $20.6 million in the fiscal year ending December 31, 2019.
"This acquisition demonstrates Infosys' commitment to innovate for its clients, and make a meaningful impact on human lives by combining cutting-edge technologies and experiences to revolutionise patient care, treatment, diagnostics and consumer health across the world," Infosys said in a statement.
Kaleidoscope Innovation brings to Infosys a diverse talent pool with extensive knowledge of design and engineering, it added.
Infosys said Kaleidoscope leverages a deep understanding of clinical environments, strong product development capabilities across domains, and a consultancy-style approach addressing human factors, product design, UI/UX design, research and insight, development, and visualisation.
Kaleidoscope serves a marquee and diversified customer base with state of the art, in-house labs, 3D design environments, and customer experience centres, the statement added.
"This acquisition further strengthens our digital offerings at the intersection of new software technologies and medical devices - a sector that is expected to witness significant investments and consumerisation in the post-COVID era," Infosys President Ravi Kumar said.
Infosys' clients will benefit from the combination of Kaleidoscope's strong upstream offerings of product innovation and design, and stack of product engineering, validation and commercialisation services at a global scale, he added.
"We are excited to welcome Kaleidoscope Innovation and its leadership team into the Infosys family, as part of Infosys Engineering Services portfolio," Kumar said.
Matt Kornau, CEO and Co-founder of Kaleidoscope Innovation, said the partnership with Infosys will allow the company to scale quickly and bring expanded offerings in artificial intelligence, analytics, and digital infrastructure to its clients.
"Kaleidoscope has always valued the ability to enhance people's lives and their outcomes through innovation. We feel Infosys shares these same values and will open new avenues for our client partners, and our staff, to pursue larger opportunities together," he added.