Shares in Capgemini jumped this morning on talk of a takeover or merger approach from Infosys.

The giant Indian outsourcing specialist has grown rapidly in recent years as demand for offshored services increases.

Infosys turned over $863m in its fourth quarter ended 31 March 2007 while Capgemini brought in revenues of €2.21bn or $2.99bn. But Infosys revenues grew 44 per cent year on year while Capgemini grew by 14.2 per cent.

Capgemini shares were up 4.6 per cent yesterday and have gone up another 1.5 per cent today on the Paris exchange.

Infosys told the Times of India that the story was speculation but its shares still rose 2.5 per cent on the Mumbai exchange.

Despite the denials observers want to believe Indian firms, with their growing cash piles, will get involved in taking over European firms.®