Technology firm Hewlett-Packard has informed that the company has signed a deal to acquire IT outsourcer Electronic Data Systems Corp. (EDS) for an estimated $13.9 billion, or $25.00 per share. HP intends to establish a new business group, to be branded EDS and headquartered at Electronic Data Systems’ existing executive offices in Plano, Texas.

EDS is a leading global technology services company delivering business solutions to its clients. EDS has been providing services to information technology outsourcing industry for 45 years. Today, EDS delivers a broad portfolio of information technology and business process outsourcing services to clients in the manufacturing, financial services, healthcare, communications, energy, transportation, and consumer and retail industries and to governments around the world.

EDS (including MphasiS) employs more than 27,000 whereas HP India has an employee base exceeding 29,000. With the EDS acquisition, HP joins the likes of IBM and Accenture that are eyeing the global IT outsourcing pie. It will also take on bigger deals from the domestic market.

The deal has been approved by both companies' boards of directors, and is expected to close in the second half of this year.

EDS controls Bangalore-based MphasiS, India’s fifth-largest IT Company. The shares of MphasiS, which comes after TCS, Infosys, Wipro and Satyam in terms of equity size, surged about 12 per cent yesterday as news of the acquisition talks came from the US.