US scientific, engineering and technology company SAIC (Science Applications International Corporation) has announced that it is selling its oil and gas IT services business to Wipro. SAIC's Global Oil and Gas Information Technology practice provides consulting, system integration and outsourcing services to global oil companies.
The sale includes the US oil and gas IT services business along with operations in the UK, France, India and the Middle East, which all mainly focus on the oil and gas market. Around 1,450 employees are expected to move to Wipro.
What makes the announcement interesting is the fact that the main reason for the sale is a future focus on sustainable aspects of the energy market. "The sale of these operations will enable SAIC to better focus on our strategic growth areas, including market segments in the energy sector, such as smart grid, renewable energy implementation, and energy efficiency, where we have successfully built our business through organic growth and acquisitions," said Walt Havenstein, SAIC CEO.
The SAIC business apparently makes a profit, but SAIC clearly sees much more growth potential in renewables than the oil and gas sector. It’s no surprise, given the huge opportunities and the fact that most IT services companies are actively positioning themselves for a slice of the action.
The purchase will boost Wipro’s non-India businesses and give it broader industry focus, but the $150m the company paid is for a bigger slice in what is already a mature market.