Indian IT services provider Wipro Technologies has decided to acquire Citigroup’s arm, Citi Technology Services, the technology and infrastructure outsourcing arm of Citibank for an all-cash offer of $127m.

Founded in 2005, India-based Citi Technology provides IT services to the Citigroup entities in more than 32 countries. The company provides critical technology infrastructure support, development and deployment of strategic software applications in the BFSI domain.

In addition, it also provides application development, maintenance and testing support for credit cards, core banking, equities and treasury to Citibank entities worldwide.

Under the arrangement, the two parties will sign a master service agreement, which will ensure Wipro at least $500 million in revenues over a period of six years.

The acquisition is expected to be closed in March 2009. This is the second time that Citibank, will sell off its Indian back-office operations.

In early October, it had sold its captive BPO Citigroup Global Services (CGSL) to Tata Consultancy Services for $505 million. It was the biggest M&A deal in India in year 2008.