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SAN FRANCISCO - Private investment firm Gryphon Investors announced Thursday it has entered into a definitive agreement to sell portfolio company 3Cloud to Cognizant Technology Solutions Corporation (NASDAQ:CTSH), a $36 billion market cap company that InvestingPro analysis shows is currently undervalued based on its Fair Value assessment.
The transaction is expected to close in the first quarter of 2026, according to the press release statement. Financial terms were not disclosed.
3Cloud, headquartered in Chicago, is a Microsoft Azure services provider offering solutions in data engineering, cloud-native AI application development, advanced analytics, and Azure managed services. The company was founded in 2016 and is recognized as an Elite Databricks partner.
Gryphon initially invested in 3Cloud in 2020 and has since completed multiple acquisitions while the company grew organically at over 20% annually. During Gryphon's five-year partnership, 3Cloud's revenue increased by more than 12 times.
Following the acquisition, 3Cloud CEO Mike Rocco and President Jim Dietrich will continue in key roles within Cognizant's Azure practice.
"Gryphon has been an exceptional partner and a true catalyst for 3Cloud's growth," said Rocco in the announcement.
The deal represents Gryphon's first exit from its technology services investment portfolio. Gryphon Investors, which manages more than $10 billion in assets, focuses on middle-market companies across various sectors including business services, healthcare, and technology solutions.
Lazard and Kirkland & Ellis represented Gryphon in the transaction, while Cognizant was represented by Mayer Brown.
In other recent news, Cognizant Technology Solutions reported impressive third-quarter 2025 earnings, with both earnings per share (EPS) and revenue exceeding analyst expectations. The company posted an EPS of $1.39, surpassing the forecast of $1.30, and recorded revenue of $5.42 billion, which was higher than the expected $5.32 billion. These results reflect the company's strong financial performance and strategic direction. Following these earnings, Mizuho raised its price target for Cognizant to $85 from $84, maintaining a Neutral rating on the stock. This revision came after Cognizant's reported organic constant currency revenue growth of approximately 4.0% year-over-year, which accelerated by 80 basis points. Additionally, the company's adjusted operating margin improved by 70 basis points year-over-year, indicating enhanced profitability. These developments highlight Cognizant's ongoing financial health and operational improvements.
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