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In this year’s second mega BPO acquisition, Teleperformance will buy Intelenet from Blackstone for $1 billion, giving the private equity firm hefty returns in less than three years.
Mumbai-based Intelenet has changed several hands but has given Blackstone good returns.
In 2015, Blackstone had bought back Intelenet from Serco for about $385 million.
“Blackstone got it back in 2015 at a good price. The management turned it around and Blackstone is getting a good exit. It’s a win-win for everyone,” said Pareekh Jain, SVP and Managing Director - India at HfS Research.
Signs of resurgence
The BPO sector, which had been showing signs of slowing down in the last few years, is now displaying some resurgence, thanks to innovative technologies, experts say.
Earlier, in March, PE biggie Capital Square Partners (CSP) merged two of its portfolio companies in the BPO space — NYSE-listed Startek and Aegis Global — to create a $700-million entity to bolster its footprint in the US and the Philippines and tap into marquee e-commerce customers. Under the deal, Startek acquired Aegis for about $300 million.
In 2016, BPO firm Minacs was bought by US-based Synnex for $420 million.
“In the last couple of years pure-play BPO companies are doing well and are moving much faster in new areas such as digital, analytics and RPA (robotic process automation).
“The higher growth rates of a few players are driving up the valuation of this sector. For investors, it is about creating value in the consolidation phase,” said HfS’ Jain.
Daniel Julien, Chairman and CEO of Teleperformance, commented: “..upon closing, this deal will be immediately accretive for Teleperformance shareholders, as it should have a positive impact of around +10 per cent on the group’s earnings per share in 2018 on a proforma basis.”
“With the large, global platform of Teleperformance combined with the transformative services capabilities of Intelenet, we will be able to deliver even greater value to the clients of both companies,” said Bhupender Singh, CEO of Intelenet. The transaction is expected to close by September 30, 2018.
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