TCS signs $1.2-bn deal with Nielsen

Mumbai: Software giant Tata Consultancy Services (TCS) has signed a contract with Nielsen Co worth $1.2 billion. The 10-year deal to provide IT and business services to the information and media company’s worldwide operations has been arranged to protect Tata’s margins from exchange-rate swings and inflation, chief operating officer N Chandrasekaran said.
“The deal has been structured in such a way that it completely protects our margins,” Chandrasekaran told a news conference, adding both parties had the option to review the deal at the end of the fifth year. He said the revenues, from the contract, will kick in this quarter. Rupee rise of around 12 per cent against the dollar this year, has squeezed the profit margins of software services firms that get revenue from the US.

Nielsen Co provides television and Internet audience measurement services and research for the consumer goods and retail industry. The company has headquarters in the Netherlands and New York. “This arrangement will help us streamline and simplify our IT infrastructure and application platforms and operational practices,” Mitchell Habib, executive vice president in charge of Nielsen Global Business Services, said in a statement

It will give us much greater flexibility to respond quickly to changes in the marketplace,” he said. TCS will also handle some of Nielsen’s finance and human resource business process.

TCS shares climbed nearly 5 per cent to Rs 1,149.50 — its highest in more than nine weeks — before ending up 2.2 per cent Rs 1118.85.

Telecom software firm Tech Mahindra last year bagged a five-year $1 billion deal from British Telecoms group BT.