Kedaara acquires India digital transformation player
Kedaara Capital has acquired a majority stake in Great Software Laboratory (GS Lab), an India-headquartered provider of digital product engineering services.
The size of the transaction was not disclosed. Kedaara is currently deploying its third India middle-market fund, which closed earlier this year on approximately $1.1 billion. There is a strategic emphasis on pursuing control transactions and adding value through operating partners.
The investment in GS Lab is intended to help the company remain ahead of the curve in meeting the digital needs of customers – whether that means helping manufacturers develop smart factories or creating online payments infrastructure for retailers – and target a wider pool of customers, from the digitally native to the traditional.
“It is quite clear that digital is becoming the core differentiator for businesses across the board globally. With a strong product DNA and IP-led culture, GS Lab is very well positioned to be one of the premier digital engineering service providers based out of India,” said Pramod Bhasin, an operating partner at Kedaara and formerly president and CEO of Genpact.
Kedaara will also leverage the Clayton, Dubilier & Rice (CD&R) network. It has a strategic partnership with the global private equity firm, which initially included helping define an approach to using operating partners.
GS Lab has created more than 350 software digital products over the past 18 years, serving clients across the technology, telecom and communications, healthcare, financial services, and real estate. Its competencies cover cloud computing and networking, internet-of-things, cybersecurity, and artificial intelligence (AI), data analytics, and machine learning.
The company works through the entire software development cycle, relying on engineering teams in India, the US, and the UK. Overall headcount exceeds 1,600. It claims to have seen annual revenue expansion of 20%-plus over the last five years.
Digital product engineering services is a high-growth sector globally. According to the National Association of Software & Service Companies (NASSCOM), a local trade association, India’s engineering R&D industry will be worth $65 billion in 2025, up from $31 billion in 2019, driven by rapid digitalization across every sector.
“Digital transformation is one of the key investment themes for us, and we are very excited to partner with the GS Lab team to support their continued development of outstanding digital software products for their clients worldwide,” said Sunish Sharma, co-CEO and managing partner of Kedaara, and Parin Mehta, a managing director of the private equity firm, in a joint statement.
DC Advisory served as the sole financial advisor to GS Lab on the transaction.
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