Infosys’ $560 million bet on two US tech firms is its all-time highest M&A spend in a year

Infosys Ltd’s announcement late on Wednesday to acquire two US-based technology services firms for $560 million pushed acquisition spend in the fiscal to an all-time high, reflecting the urgent need for new talent as automation tools boost India’s tech sector.

The nation’s second-largest information technology (IT) services company said it will spend up to $465 million to acquire Florida IT services and consulting firm Optimum Healthcare IT.

On the same day, it announced the acquisition of Stratus, a New Jersey-based provider of technology services for the insurance industry, for $95 million.

Both deals are in cash and are expected to be completed by June. The payout includes upfront amounts and earnings, but excludes management incentives and retention bonuses.

The acquisitions will add $319 million in additional revenue to Infosys, including $276 million from Optimum Healthcare and $43 million from Stratus, accounting for almost 45% of Infosys’ incremental revenue last year.

Infosys finished last year with $19.28 billion in revenue, up 3.85% year-on-year. It expects to end the current fiscal year with 3-3.5% growth in constant currency terms. A fixed currency does not take into account currency fluctuations.

Industry-wide increase in acquisitions

These acquisitions take the number of acquisitions Infosys has made in this financial year to five. In April last year, it acquired US MRE Consulting and Australian cyber security company The Missing Link for a total of 98 million dollars. Three months later, it acquired Australia’s Versent Group for over $150 million.

Wednesday’s deals The company, which pioneers Indian technology services, increased its total spend on acquisitions to $808 million in FY26, or ₹7,500 crore — the highest amount spent on acquisitions among the country’s top five IT services companies, including Tata Consultancy Services (TCS), HCL Technologies, Wipro and Tech Mahindra.

TCS, HCLTech and Wipro spent $773 million, $400 million and $375 million respectively on acquisitions in the current financial year. Mumbai-based TCS has acquired three companies led by Florida-based Coastal Cloud, spending $700 million to acquire it. The 2026 fiscal year marks the most the company has spent on acquisitions in a single year since it was listed in 2004.

Infosys’ acquisition spend this financial year has also reached its highest level in the last two decades. The Bengaluru-based company surpassed its 25th Anniversary record by spending approximately 25 million ₹3,155 crore in acquisitions, according to a report Mint review.

But that pales ahead of deals by industry No. 7 Coforge Ltd, which spent $2.39 billion to acquire US-based Encora in an all-stock deal. It is noteworthy that Accenture Plc, the world’s largest IT services company, also increased its acquisition budget for the whole year from $3 billion allocated in the previous quarter to $5 billion.

The flurry of acquisitions for Indian IT comes at a time when the software services sector is experiencing slow growth due to the rise of automation tools and, more recently, the West Asian war, which are jeopardizing the work of domestic IT services companies.

What good does it do for Infosys?

Infosys’ acquisition of Optimum Healthcare aims to enhance cloud and digital transformation for healthcare providers such as hospitals and clinics.

“By bringing together Optimum’s provider experience with Infosys Topaz and Infosys Cobalt, we are positioned to create a differentiated value proposition for healthcare providers, accelerating end-to-end cloud, data and digital transformation,” Infosys CEO Salil Parekh said as part of the company’s listing on stock exchanges on Wednesday.

On the other hand, the Stratus acquisition is expected to enhance Infosys’ industry-specific insurance offerings.

“Infosys is unlocking the value of AI through digital and data-driven transformation for P&C (property and casualty) insurers,” Kannan Amaresh, senior vice president and head of insurance at Infosys, said in the company’s statement.

As part of the acquisition, Infosys is expected to add more than 2,000 employees; of these, approximately 1,600 are from Optimum Healthcare and approximately 450 are from Stratus. The company closed last year with 337,034 employees.

One expert called the buys targeted bets.

“These are not flashy acquisitions. These are targeted bets on healthcare provider transformation and P&C insurance modernization, two markets where industry expertise still separates real implementation from AI theater,” said Phil Fersht, CEO of HFS Research. “Infosys is trying to move the conversation from the broad AI goal to industry-specific application. This is where real service value will be gained.”