Wipro's GM deal for $27 mn
Wipro's 5-year GM deal is far less than the $300 mn as was earlier reported.india Updated: Feb 16, 2006 19:12 IST
Wipro Ltd said on Friday that a 5-year computer services deal with General Motors Corp was far less than the $300 million as was reported earlier.
Wipro was the only Indian company to be awarded work in the latest GM contract. The company's inclusion in the contract was celebrated in India as a major win for an Indian information- technology services company.
Wipro said on Friday its contract was actually worth $27 million over five years, less than one tenth the original figure. Current contracts with GM were expected to yield revenue of about $40 million for the fiscal year ending in March 2006, Wipro of Bangalore, India, said in a statement.
Reports that the deal was worth $300 million were carried widely in India and abroad. But on Friday, Wipro issued a statement saying the "$300 million number which has been reported as the value" of the contract "is not accurate."
"The numbers reported as the value of this contract yesterday were purely estimates of future business we hope to attain with GM and other IT (information technology) suppliers supporting GM's business," the company said in the statement.
Wipro on Thursday had said its share of the GM contract was estimated at $300 million over 5 years. General Motors awarded computer services contracts totaling about $7.5 billion to Electronic Data Systems, International Business Machines Corp, Hewlett-Packard Co, France's Cap Gemini and the Compuware Covisint unit of Compuware Corp, among others.
Wipro on Thursday held a news conference in Bangalore at which Sudip Banerjee, the company's president for enterprise solutions, said revenue from the contract would start flowing from the second quarter of Wipro's next fiscal year, which ends in March, 2007. He did not say how revenue would be spread over the period of the contract.