Cognizant, an information technology services and consulting company, announced on Monday, June 10, an agreement to purchase digital engineering firm Belcan for almost $1.3 billion in mixed cash and shares. 

Deal Between Cognizant, Belcan Projected to Finalize in Q3

According to a press release, Belcan will remain under the leadership of its CEO, Lance Kwasniewski, and function as a division of Cognizant as part of the deal.

The purchase will be completed in the third quarter, pending regulatory clearances and other conditions. The deal's total purchase price of $1.29 billion, subject to customary adjustments, includes $1.19 billion in cash and 1.47 million Cognizant shares, worth $97 million based on the closing share price on Friday, June 7.

With a market cap of $33 billion, Cognizant is preparing to reduce customer spending and enhance its products in specialized areas. According to Reuters, the company's previous revenue projection was between $19.0 billion and $19.8 billion but has now reduced it from $18.9 billion to $19.7 billion.

Read Also: Robinhood Acquires Crypto Platform Bitstamp for $200 Million

Cognizant Anticipates Growth in Various Sectors After Deal With Belcan

The acquisition would increase Cognizant's presence in the aerospace, military, space, and automotive industries. Headquartered in Cincinnati, Ohio, Belcan has a worldwide workforce of 10,000 spread throughout 60 offices.

The US Navy, National Aeronautics and Space Administration (NASA), General Motors, Rolls-Royce, and Boeing are among its customers. In the statement, Cognizant CEO Ravi Kumar expressed excitement about Belcan's position in the aerospace and defense industry, which is expanding at a quicker rate than Cognizant's own business.

He also pointed out that Belcan's engineering skills will benefit Cognizant's manufacturing, automotive, energy, and high-tech divisions.

Read More: Tech News Portal Gizmodo Acquired by Europe-Based Media Firm Keleops