U.S. software firm iGate , backed by private equity firm Apax Partners, has agreed to buy a majority stake in India's Patni Computer for $862 million, two sources with knowledge of the matter said, marking one of the largest deals in India's technology sector. Small- and mid-cap companies in the IT services sector have been grappling with tepid demand, high attrition rates amid tough competition from larger rivals and a rise in expenses. Merging would allow mid-sized companies to increase scale and target bigger clients. "There is scope for consolidation in this sector and it will happen," said Rakesh Rawal, head of private wealth management at Anand Rathi Financial. "Smaller players will have to get together for value creation," he said.
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