Cognizant Technology Solutions Corp. (NASDAQ:CTSH), a U.S. IT outsourcing services provider, has agreed to buy privately held health care software maker TriZetto Corp. for $2.7 billion in cash, Cognizant said in a statement Monday. Shares were little changed in early afternoon trading in New York. The deal, subject to regulatory approvals, will add more than $500 million in annual revenue to Cognizant’s health care technology services unit, which contributes more than a quarter of the Teaneck, New Jersey, company’s sales.

"Healthcare is undergoing structural shifts due to reform, cost pressure and shifting responsibilities between payers and providers,” Chief Executive Officer Francisco D’Souza said in a statement, referring to insurance providers and hospitals.

“This creates a significant growth opportunity, which TriZetto will help us capture," he said.

Cognizant ended 2013 with $8.8 billion in revenues and 170,000 staff, the bulk of whom are in India. The company competes with the top Indian IT providers for outsourcing contracts in the U.S., it’s biggest market.

Rising competition in a recovering U.S. economy and changing business in its biggest markets have put pressure on Cognizant. It said Aug. 6 it was reducing its full-year growth forecast for 2014 to at least 14 percent from its May estimate of at least 16.5 percent, which itself was lower than the more than 20 percent growth in 2013. Investors sold its stock down nearly 13 percent that day.

Cognizant expects the acquisition to bring it multiple health care software platforms used both by insurers and hospitals, opportunities to provide additional services around those software solutions and “approximately $1.5 billion of potential revenue synergies cumulatively over the next five years,” the company said in the statement.

TriZetto and its 3,700 employees will become part of Cognizant's existing health care business, which currently serves more than 200 clients, including 16 of the top 20 U.S. health plans and four of the top-five pharmacy benefit management companies. Cognizant's health care IT sales, at about $2.5 billion in annualized revenue, currently represents 26 percent of its sales, the company said.

TriZetto is currently owned by funds advised by Apax Partners, together with minority investors BlueCross BlueShield of Tennessee and Cambia Health Solutions.

Cognizant will pay for the deal with a combination of its own cash reserves and a $1 billion loan it has secured, the company said in the statement. The transaction is expected to close in the fourth quarter of 2014.

Cognizant was advised by Credit Suisse, UBS Securities LLC and Centerview Partners. Legal counsel to Cognizant was provided by Latham & Watkins LLP and Nishith Desai Associates. TriZetto was advised by J.P. Morgan Securities LLC and Goldman, Sachs & Co. Legal counsel to TriZetto was provided by Kirkland & Ellis LLP.