EDS is acquiring RelQ, a privately owned software testing company in Bangalore, India to strengthen its global testing capabilities by offering applications testing, validation and verification, and quality assurance services.

RelQ has more than 700 employees in India, the UK, US and France, who are expected to become a part of EDS' global testing organisation, the IT services giant said. The financial terms of the transaction were not disclosed, but EDS said the transaction is expected to close in May.

EDS' interest in acquiring RelQ has been speculated on for almost a year now. A report in February in an Indian daily, The Times of India, put the acquisition price at $40 million (£20.7m).

Focused primarily on the banking, financial services, telecom and consumer electronics industries, RelQ offers real-time and embedded applications testing, including mission critical software testing, for clients looking to deploy applications across the enterprise.

EDS last year acquired a majority stake in Indian outsourcer MphasiS. The company is also merging its own Indian services subsidiary with MphasiS through a stock swap.

A number of multinational services companies, including IBM, are expanding their service delivery capabilities from India by acquiring local companies or foreign companies with large Indian services operations. French IT services company Capgemini completed in February its acquisition of Kanbay International, an IT services firm in Rosemont, Illinois, to boost its services delivery from India, and its business in the financial services sector.