Convergys in talks to buy Minacs

Convergys Corp, the US based call centre operator with operations in India, is in advanced talks to buy business process outsourcing (BPO) firm Minacs Ltd in a deal worth $500 Million. Convergys and a clutch of PE investors, including CVC Capital Partners Ltd and HIG Capital Partners had expressed interest in buying Minacs.

Minacs was acquired by the current owners from Aditya Birla Nuvo Ltd for $260 Million in 2014. In 2006, TransWorks Information Services Pvt. Ltd a unit of Aditya Birla Nuvo had acquired Canada firm Minacs Worldwide Inc. for about $125 Million. The $3 Billion Convergys provides customer management services in 58 Languages from more than 150 locations across the world. It employs 130,000 people across 31 countries.

Convergys claims to be number one in the US customer management industry with more than half of the top 50 Fortune 500 companies as clients. In India, Convergys is the 10^th largest with operations in Mumbai, Thane, Pune, Hyderabad, Gurgaon and Bengaluru. Minacs could be a right acquisition target for Convergys as it will help to strengthen its position in India, a fast growing outsourcing market.

Wipro buys Viteos

Wipro Ltd. has agreed to buy Viteos Group, a securities processing and fund administration services provider, for $130 Million in an effort to expand its portfolio of services to financial companies.

The 12 year old New Jersey based Viteos provides services including processing, reconciliation of trade, settlements and customer data across asset classes and currencies for investment banking clients in the US, Europe and Asia. Wipro plans to use Viteos licensing platform to offer services to buy side companies, a term used by investment bankers to refer to institutions that buy investment services such as mutual funds, pension funds and insurers.

Wipro, India’s third largest software exporter already offers many of these solutions to its clients on the sell side of capital markets. They in turn, sell investment services to asset management companies. Viteos, which generated $26.5 Million in revenue in the year ended March with roughly 400 employees, will retain its brand identity to further strengthen its presence among existing clients.

The acquisition reflects a broader shift in India’s software outsourcing industry towards building an arsenal of intellectual property led high margin software platforms rather than relying on an army of engineers to offer technology solutions to clients. Wipro and Infosys have also been investing heavily in startups to build new age technology solutions for clients.

Filipino BPO, Blackstone to acquire Serco India

Private equity giant Blackstone and Filipino BPO Company SPi Global remain in race for buying London listed Serco’s Indian BPO Unit.  The deal is said to be in the range of $400 Million. Formerly known as Intelenet, it had been sold by Blackstone to Serco for $634 Million in 2011. Out of both companies, only one company will win the bid to acquire Serco BPO Unit.

Intelenet was set up in 2000 as a 50-50 venture between HDFC and TCS. In 2004, HDFC acquired TCS stake for 160 crore to sell it to Barclays later. In 2007, Blackstone bought an 80 percent stake in Intelenet for about $260 Million. When it sold Intelenet in 2011, Blackstone had a 66 percent stake and rest was divided among Barclays, HDFC and the management team. Blackstone had managed to get more than a 60 percent return on its four year investment.

Serco had announced the future strategy of the company would be to focus on being a Business to government service provider across five core areas and four key regions. SPi Global, a leading diversified BPO service provider in Philippines operates on offshore based model primarily serving US and Europe Customers with more than 20,000 employees across 17 delivery locations in six countries, including India, US, China, Vietnam, and Nicaragua.

In April 2012, Serco Group had bought all its BPO assets together to create Serco Global Services. Serco BPO operation is largest in India after Genpact and TCS.