TCS wins record $2.25 billion Nielsen outsourcing contract

Tata Consultancy Services Ltd (TCS) has won a $2.25 billion outsourcing contract, the largest ever bagged by an Indian information technology firm, from television ratings measurement company Nielsen.

The deal marks the renewal of TCS’s engagement with Nielsen, which first awarded a $1.2 billion, 10-year contract to the Mumbai-based company in 2007. In 2013, the deal size was more than doubled to $2.5 billion and extended by three more years until 2020.

The renewal of the deal is considered a shot in the arm for Rajesh Gopinathan, who took over as chief executive officer in February after his predecessor N. Chandrasekaran was appointed chairman of Tata Sons Ltd, the group holding company.

Nielsen’s outsourcing contract has been extended for five years until 2025 even as the rating firm has committed to spend more on buying services offered by TCS for the remaining four years of the earlier contract.

Under the $2.25 billion contract, TCS is assured of $320 million in business from Nielsen every year, beginning 2017 through 2020, $186 million in annual revenue from 2021 through 2024 and $139.5 million in 2025, according to a regulatory filing made by Nielsen to the US Securities and Exchange Commission.