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Accenture Federal Services Completes Acquisition of Cognosante

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Accenture Federal Services has finalized its acquisition of Cognosante, a company based in Falls Church, Virginia, that specializes in digital transformation and cloud modernization for federal agencies. Announced on April 15, 2024, the acquisition aims to enhance Accenture's federal health portfolio, providing mission-driven technology solutions for healthcare programs.

The acquisition will add over 1,500 employees to Accenture Federal Services, which already has a workforce of over 14,000. The new portfolio is designed to deliver specialized mission solutions to improve health outcomes and make healthcare more accessible and equitable.

Accenture Federal Services' CEO, John Goodman, emphasized that the addition of Cognosante's expertise and capabilities will accelerate the company's impact in the federal health market.

Financial details of the acquisition were not disclosed.

Positive
  • Accenture Federal Services adds over 1,500 employees to its workforce.
  • Acquisition enhances Accenture's federal health portfolio.
  • Improves capability in digital transformation and cloud modernization.
  • Potential for better health outcomes and more equitable healthcare experiences.
  • Strengthens Accenture's position in the federal health market.
Negative
  • Financial terms of the acquisition were not disclosed, leading to potential investor uncertainty.

Accenture Federal Services' acquisition of Cognosante signifies a strategic expansion into the federal health market. However, the lack of disclosed financial terms leaves investors somewhat in the dark regarding the precise financial impact. Historically, Accenture has demonstrated a strong track record of integrating acquisitions successfully, which likely bodes well for this merger as well.

From a financial perspective, this acquisition could potentially drive revenue growth by tapping into new federal contracts and expanding Accenture’s footprint in healthcare IT. Investors should also consider the cost synergies that may arise from integrating Cognosante’s operations with Accenture’s existing infrastructure, though these benefits may take time to materialize.

Short-term, the news might not significantly move the stock price due to the absence of detailed financials. However, in the long run, successful integration and execution of this acquisition could lead to increased earnings and market share in a growing sector.

The acquisition of Cognosante by Accenture Federal Services positions Accenture to leverage expanded opportunities within the federal health market. This sector is becoming increasingly vital, especially with the growing focus on digital transformation and cloud modernization in public services.

Accenture’s decision to create a dedicated federal health portfolio suggests a strategic and targeted approach to addressing the specific needs of federal health clients. This move could help Accenture differentiate itself from competitors and capitalize on the increasing demand for specialized technology solutions in the healthcare sector.

For retail investors, understanding the significance of this sector's growth potential is crucial. The federal health market is expected to continue expanding as government agencies invest more in digital infrastructure and cloud capabilities to improve public health outcomes. Accenture’s increased footprint in this area could be a positive signal for long-term growth and stability.

Company Launches Health Portfolio to Deliver Specialized Mission Solutions

ARLINGTON, Va.--(BUSINESS WIRE)-- Accenture Federal Services has completed its acquisition of Cognosante, a Falls Church, Virginia-based provider of digital transformation and cloud modernization solutions for federal health, defense, intelligence, and civilian agencies. Accenture Federal Services announced its intent to acquire Cognosante on April 15, 2024.

Cognosante provides mission-driven technology solutions for federal government clients, including healthcare programs supporting veterans, active-duty military, patients, beneficiaries, providers, and payors. The company has an exemplary delivery track record powered by technology expertise, cloud modernization and migration capabilities, and program management.

With the acquisition, Accenture Federal Services is creating a new federal health portfolio for its business. This portfolio will deliver the specialized mission solutions that clients need to drive better health outcomes and more accessible, equitable healthcare experiences for all.

“The health market is a unique mission space in the U.S. federal government,” said Accenture Federal Services CEO John Goodman. “With the addition of Cognosante’s industry-leading people and capabilities, and by continuing to draw upon Accenture’s proven commercial innovation in health, life sciences, and insurance, Accenture Federal Services will accelerate impact for our clients and offer greater career growth opportunities for our people as a result of this acquisition.”

The acquisition adds more than 1,500 people to Accenture Federal Services’ more than 14,000-person workforce.

Financial terms of the acquisition were not disclosed.

Accenture Federal Services is a wholly owned subsidiary of Accenture (NYSE: ACN).

About Accenture Federal Services

Accenture Federal Services is a leading US federal services company and subsidiary of Accenture LLP. We empower the federal government to solve challenges, achieve greater outcomes, and build a digital core that is agile, smart, and secure. Our 14,000 people are united in a shared purpose to advance our clients’ mission-critical priorities that make the nation stronger and safer, and life better for people. We draw out the best of Accenture’s global network in nearly every industry, bringing proven commercial innovation to solutions built with advanced R&D, emerging technologies, and human-centered design at speed and scale. Together, we help clients create lasting value for their workforce, customers, and partners and make a difference for the country and our communities. See how we make change that matters at accenturefederal.com.

About Accenture
Accenture is a leading global professional services company that helps the world’s leading businesses, governments and other organizations build their digital core, optimize their operations, accelerate revenue growth and enhance citizen services—creating tangible value at speed and scale. We are a talent- and innovation-led company with approximately 742,000 people serving clients in more than 120 countries. Technology is at the core of change today, and we are one of the world’s leaders in helping drive that change, with strong ecosystem relationships. We combine our strength in technology and leadership in cloud, data and AI with unmatched industry experience, functional expertise and global delivery capability. We are uniquely able to deliver tangible outcomes because of our broad range of services, solutions and assets across Strategy & Consulting, Technology, Operations, Industry X and Song. These capabilities, together with our culture of shared success and commitment to creating 360° value, enable us to help our clients reinvent and build trusted, lasting relationships. We measure our success by the 360° value we create for our clients, each other, our shareholders, partners and communities. Visit us at www.accenture.com.

Forward-Looking Statements
Except for the historical information and discussions contained herein, statements in this news release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “should,” “likely,” “anticipates,” “aspires,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “positioned,” “outlook,” “goal,” “target” and similar expressions are used to identify these forward-looking statements. These statements are not guarantees of future performance nor promises that goals or targets will be met, and involve a number of risks, uncertainties and other factors that are difficult to predict and could cause actual results to differ materially from those expressed or implied. These risks include, without limitation, risks that: the transaction might not achieve the anticipated benefits for Accenture; Accenture’s results of operations have been, and may in the future be, adversely affected by volatile, negative or uncertain economic and political conditions and the effects of these conditions on the company’s clients’ businesses and levels of business activity; Accenture’s business depends on generating and maintaining client demand for the company’s services and solutions including through the adaptation and expansion of its services and solutions in response to ongoing changes in technology and offerings, and a significant reduction in such demand or an inability to respond to the evolving technological environment could materially affect the company’s results of operations; if Accenture is unable to match people and their skills with client demand around the world and attract and retain professionals with strong leadership skills, the company’s business, the utilization rate of the company’s professionals and the company’s results of operations may be materially adversely affected; Accenture faces legal, reputational and financial risks from any failure to protect client and/or company data from security incidents or cyberattacks; the markets in which Accenture operates are highly competitive, and Accenture might not be able to compete effectively; Accenture’s ability to attract and retain business and employees may depend on its reputation in the marketplace; if Accenture does not successfully manage and develop its relationships with key ecosystem partners or fails to anticipate and establish new alliances in new technologies, the company’s results of operations could be adversely affected; Accenture’s profitability could materially suffer if the company is unable to obtain favorable pricing for its services and solutions, if the company is unable to remain competitive, if its cost-management strategies are unsuccessful or if it experiences delivery inefficiencies or fail to satisfy certain agreed-upon targets or specific service levels; changes in Accenture’s level of taxes, as well as audits, investigations and tax proceedings, or changes in tax laws or in their interpretation or enforcement, could have a material adverse effect on the company’s effective tax rate, results of operations, cash flows and financial condition; Accenture’s results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates; changes to accounting standards or in the estimates and assumptions Accenture makes in connection with the preparation of its consolidated financial statements could adversely affect its financial results; as a result of Accenture’s geographically diverse operations and strategy to continue to grow in key markets around the world, the company is more susceptible to certain risks; if Accenture is unable to manage the organizational challenges associated with its size, the company might be unable to achieve its business objectives; Accenture might not be successful at acquiring, investing in or integrating businesses, entering into joint ventures or divesting businesses; Accenture’s business could be materially adversely affected if the company incurs legal liability; Accenture’s global operations expose the company to numerous and sometimes conflicting legal and regulatory requirements; Accenture’s work with government clients exposes the company to additional risks inherent in the government contracting environment; if Accenture is unable to protect or enforce its intellectual property rights or if Accenture’s services or solutions infringe upon the intellectual property rights of others or the company loses its ability to utilize the intellectual property of others, its business could be adversely affected; Accenture may be subject to criticism and negative publicity related to its incorporation in Ireland; as well as the risks, uncertainties and other factors discussed under the “Risk Factors” heading in Accenture plc’s most recent Annual Report on Form 10-K and other documents filed with or furnished to the Securities and Exchange Commission. Statements in this news release speak only as of the date they were made, and Accenture undertakes no duty to update any forward-looking statements made in this news release or to conform such statements to actual results or changes in Accenture’s expectations.

Donna Savarese

Accenture Federal Services

+1 301 250 0660

donna.savarese@afs.com

Source: Accenture Federal Services

FAQ

What company did Accenture Federal Services acquire?

Accenture Federal Services acquired Cognosante.

When was the acquisition of Cognosante announced?

The acquisition was announced on April 15, 2024.

How many employees will join Accenture Federal Services after the acquisition?

Over 1,500 employees will join Accenture Federal Services.

What will the new federal health portfolio focus on?

It will focus on providing specialized mission solutions to improve health outcomes and make healthcare more accessible and equitable.

Was the financial detail of the acquisition disclosed?

No, the financial terms of the acquisition were not disclosed.

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Accenture plc is an Irish-American professional services company based in Dublin, specializing in information technology services and consulting. A Fortune Global 500 company, it reported revenues of $61.6 billion in 2022.