Tata Consultancy Services stands to gain a substantial foothold in the North American financial services market, and a significant revenue boost, from a deal Wednesday with Citigroup Inc.

The information technology arm of Tata Group in Mumbai said it had agreed to buy Citigroup Global Services Ltd., Citi's Indian captive business-process outsourcing unit, for $505 million in cash.

Citi also signed an agreement worth $2.5 billion over the next nine and a half years for Tata to provide process outsourcing services to Citi and its units.

N.G. Subramaniam, the president of Tata's TCS Financial Solutions unit, said the deal, which is expected to close within three months, would help it develop a "shared services infrastructure" that it could offer to other financial clients.

The deal "significantly enhances the strategic direction that we outlined some time back," Mr. Subramaniam said in an interview Wednesday. "We can take this very strong offering to the 180-plus customers we have in the banking and financial services space."

Tata Consultancy already is a strong player in the banking technology market, ranking 10th on American Banker's FinTech 100 list in 2007. Its $1.6 billion of financial services revenue was 60% of its total.

But since the establishment of TCS Financial Solutions in May 2007 to focus on banking and financial services, the unit has done what Mr. Subramaniam described as "bits and pieces of work … for many customers."

By contrast, Citigroup Global Services provides end-to-end process management and a broad array of services to its parent's consumer, corporate, and global wealth management businesses worldwide, the two companies said in a joint announcement.

The Citi unit has more than 12,000 employees in India and expected revenues of $278 million this year, more than half the price Tata is to pay.

Mr. Subramaniam said the Citi unit, which will become part of TCS Financial Solutions, also is geographically diversified, with North America accounting for 43% of its revenue; the Europe-Middle East-Africa region, 26%; and the rest of the world, 31%.

Tata Consultancy is best known as an outsourcer for the development of information technology, and TCS Financial Solutions was set up in part to sell packaged software products such as a core banking application. The Citi deal significantly bolsters the company as a business-process outsourcer.

"When you have all three elements, you get into the strategic services play," Mr. Subramaniam said.

The deal had been rumored since August, when The Economic Times, a financial paper in Mumbai, wrote that the two companies were discussing a sale in the $500 million to $550 million range.

Mr. Subramaniam said that Citi put the unit on the market about a year ago and negotiations intensified in the last three months.

The $505 million sale price is a small step for Citi, which has been losing money for the past three quarters, as it grapples with the global credit crisis. The New York company unveiled a plan in May to return to profitability that included divesting roughly $400 billion of assets. Citi said in July it would sell its retail operations in Germany for $7.75 billion to Credit Mutuel of France.

Don Callahan, Citi's chief administrative officer, said in the press release, "This transaction is expected to help reduce operating expenses related to business processing and will allow us to focus on our core financial services competencies."

A Citi spokeswoman in New York said the company would not comment further.