Capgemini to sell U.S. government unit over ICE work
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By
Nick Wakeman
The French government’s pressure on the Paris-based company over detention facility contracts has prompted the plan to divest the small but controversial unit.
Capgemini is selling its U.S. government subsidiary because of the work the unit does with Immigration and Customs Enforcement.
The Paris-based company announced the decision on Sunday and said that legal restrictions didn’t allow it to “exercise appropriate control over certain aspects of the operations of this subsidiary.”
Work with ICE represents 65.3% of revenue for Capgemini Government Solutions. U.S. Citizenship and Immigration Services accounts for another 20%, according to USASpending.gov.
The Associated Press reported last week that the French government was pressuring Capgemini to be more transparent about the work the subsidiary does for the U.S. government.
Like many foreign-owned contractors, Capgemini Government Solutions operates as a separate legal entity from its parent so it can do classified work for the U.S. government. It operates in the U.S. under a Special Security Agreement.
“This creates many restrictions, notably CGS has a board that is controlled by cleared independent US directors, decision making is separate, networks are firewalled,” Capgemini Group CEO Aiman Ezzat wrote on LinkedIn last week. “The Capgemini Group cannot access any classified information, classified contracts, or anything relating to the technical operations of CGS, as required by U.S. regulation.”
The pressure by the French government on the parent company began in December when the subsidiary won a contract with ICE.
“The nature and scope of this work have raised questions compared to what we typically do as a business and technology firm,” Ezzat wrote.
He also said that Capgemini Government Solutions’ independent board had started a review of the contract.
That review apparently led to the decision to sell Capgemini Government Solutions.
According to Federal Procurement Data System, the U.S. business has several contracts with ICE’s Detention Compliance and Removals office, which helps manage detention facilities and monitoring of people in the U.S. without authorization.
The U.S. government business only accounts for only 0.4% of Capgemini’s total revenue and less than 2% of its U.S. revenue. The company expects about $24.5 billion in overall revenue when it reports its 2025 results.