Serco secures Indian acquisition

Serco is to buy Indian private sector outsourcing company Intelenet for up to £385m ($634.4m) as part of a drive to branch out into higher growth overseas markets.

Serco, which wants to bolster its international businesses after recent strong overseas growth, said the deal would provide access to markets that are forecast to grow around 15 per cent per year in the medium term.

“The international BPO (business process outsourcing) market is growing quickly as companies seek out new ways to improve their service and reduce costs,” chief executive Chris Hyman said.

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“Intelenet’s high value capabilities and customer base, together with its economies of scale, means we can access new markets and strengthen our existing propositions.”

Intelenet, which provides middle and back office outsourcing services to the private sector internationally and in India, has operations in seven countries, working mainly in the financial services, travel, healthcare and telecom sectors.

Serco said the total acquisition cost of up to £385m included contingent payments of up to £50m and would be fully funded from its debt facilities.

Intelenet, which is based in Mumbai, reported revenue for the year to March 31 of approximately £170m with adjusted operating profit of £19m.

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