Infosys Loses RBS Deal; Shares Fall, Hundreds of Jobs At Stake
Infosys shares slumped on Tuesday, a day after Royal Bank of Scotland decided to cancel a project to set up a separate bank in the UK.
File photo of Infosys campus.
Infosys has said it will ramp-down about 3,000 jobs following Royal Bank of Scotland's decision to cancel the project to set up a separate bank in the UK.
RBS announced last week that it will not pursue its plan to separate and list a new UK standalone bank, Williams & Glyn (W&G), for which Infosys was a key technology partner.
"Infosys has been a W&G program technology partner for Consulting, Application Delivery and Testing services, and subsequent to this decision, will carry out an orderly ramp-down of about 3,000 persons, primarily in India, over the next few months," Infosys said in a statement.
An Infosys spokesperson clarified that these jobs are not being cut and that the employees will be reallocated to other projects.
RBS is a key relationship for Infosys and the company looks forward to further strengthening strategic partnership and working with them across other strategic and transformation programmes, it added.
While Infosys has not specified the impact of the cancellation, market analysts peg it at around USD 40 million. The loss of the five-year 300-million pound RBS deal could force Infosys to further downgrade revenue guidance for FY2016-17. Infosys had in July slashed annual sales outlook citing weak demand to 10.512 per cent in constant currency terms, lower than the previously estimated 11.513.5%.
Stock of Infosys was trading at Rs 1,054.10, down by 0.87% on BSE in afternoon session.
Get the best of News18 delivered to your inbox - subscribe to News18 Daybreak. Follow News18.com on Twitter, Instagram, Facebook, Telegram, TikTok and on YouTube, and stay in the know with what's happening in the world around you – in real time.
Recommended For You
- Milind Soman and Ankita Konwar Share Vacation Pictures from Iceland
- Rafael Nadal Gets Married to His Partner of 14 Years Xisco Perello
- Sorry Pixel 4 But iPhone Users Can Get Free Unlimited Storage on Google Photos
- Disha Patani and Tiger Shroff Add Star Power to ISL 2019-20 Opening Ceremony
- TRAI to Decide on Jio, Airtel And Vodafone Battle For How Long Your Phone Should Ring