PARIS (Reuters) - French business consultancy firm Capgemini on Monday said it agreed to buy engineering and digital services company Altran for 3.6 billion euros ($4.10 billion)to tap into the fast-growing engineering outsourcing services market.

FILE PHOTO: The logo of Capgemini is pictured during the Viva Tech start-up and technology summit in Paris, France, May 25, 2018. REUTERS/Charles Platiau/FIle Photo

With the acquisition, Capgemini said it hoped to respond to demand from its customers -- companies in industries ranging from telecom to aerospace -- to outsource engineers as well as research and development teams.

Capgemini said it would offer 14 euros per Altran share in cash, representing a 22% premium over Altran’s Monday closing price of 11.47 euros. The deal is expected to be completed by the end of 2019.

Capgemini said it would pay 3.6 billion euros in cash and would assume Altran’s net debt of 1.4 billion euros. The tender offer will be launched once regulatory approvals are secured.

Capgemini also expects to achieve cost reduction of 70-100 million euros within three years and boost sales by 200-350 million euros on the back of new services offered to the companies’ existing customers.

The transaction would increase Capgemini’s earnings per share by more than 15% before savings from the combination, with the deal expected to add over 25% to earnings per share by 2023.

The combined company would have annual revenues of 17 billion euros and more than 250,000 employees.

“Capgemini and Altran will create a leader in engineering and research and development, a market expanding by 9% a year over the coming years,” Capgemini’s Chief Executive Paul Hermelin told reporters on a conference call.

Governance of the combined entity was not disclosed.

Capgemini said it had already secured the approval of private equity fund Apax Partners, which owns 11% of Altran alongside other shareholders.

Hermelin said he did not expect the merged company to be required to dispose any assets by regulatory authorities, given each company’s limited market share in a fragmented market dominated by players such as U.S firm Accenture and Germany’s SAP.

A source with knowledge of the transaction told Reuters Perella Weinberg Partners advised Altran while Lazard worked with Capgemini on the deal.