Mumbai, Apr 02: Big Blue may well be eyeing a small fish in this part of the world. Global IT powerhouse IBM is believed to be in talks to acquire Daksh e-Services, an independent or third-party business process outsourcing (BPO) company headquartered in Gurgaon. Sources said that negotiations are at an advanced stage and IBM is likley to buy out a large number of shareholders in Daksh, an unlisted company which has been planning an $100-150 mn IPO. Three private equity investors - General Atlantic Partners, CDC (now called Actis) and Citigroup - holds two-third of the equity capital in Daksh, while the balance is with chief executive Sanjeev Agarwal and founder promoters and members of the senior management. However, when contacted, Agarwal denied any such development, but later said: "We would not like to comment on market speculation."
However, banking sources familiar with the development said that talks are underway. Third-party providers of BPO services are different from captive BPO units---such as GE--- which supply services to their parent company.
If the deal materialises, it would be IBM's first acquisition in India. Till now IBM's India strategy has been purely organic.
IBM Global Services Worldwide (IGS) with a revenue of $42.6 bn and signings of $55.5 bn in '03, spearheads IBM's BPO strategy. IBM, together with its software and global services arm, Global Services India employs around 6000 professionals in India.
Last May, IBM merged its two Indian arms - IBM Global Services and IBM India. Recently, IBM struck a $750 m deal with Bharti involving the outsourcing of Bharti Televentures' customers facing IT applications. IBM had entered the global consultancy market with its acquisition of PwC Consulting. Four-year old Daksh, with revenues of $29.1 m as on March 31, '03, undertakes customer service, technical support, back office transaction processing services, inbound customer care which includes voice, e-mail and chat, mortgage claims and outbound collections.
It has recently acquired a facility in Philippines. The firm's profit figures are not available. Daksh's major customers are Amazon.com and CitiMortgage - the mortgage banking subsidiary of Citigroup.
The contract includes CitiMortgage's global customer queries (pre-sale and post-sale), mortgage processing, refinance, logistics management and related tech-support.
Bureau Report