Private equity backed informational technology (IT) services companies seem to be in the thick M&A action.
Japan's IT services major NTT Data Corporation continues to expand its India presence with the acquisition of Citigroup Venture Capital-owned Keane International, Inc. In another deal BPO firm iQor Holdings, which is owned by PE firms, has acquired business-to-business accounts
receivable outsourcing services player RMS, which has offices in countries including India.
Keane provides a broad range of IT services related to custom application development and management, enterprise application services, infrastructure solutions, and business process outsourcing. Keane, which is headquarterd in US with 12,500 employees, has a significant presence in India with global delivery centers in Bangalore and Chennai. Keane was acquired by CVCI-backed Caritor (promoted by former Wipro board member Mani Subramanian) in 2007 in a transaction worth $800 million to $1 billion and delisted from NASDAQ.
The transaction is part of NTT DATA’s strategy to accelerate its globalization and boost its global portfolio and overseas presence, the Japanese firm said in a statement. This is NTT DATA's third
acquisition of a company with major presence in India. It acquired Hyderabad-based IT offshoring firm Intelligroup for $199 million in June this year, marking the first large deal by a Japanese firm in the Indian information technology space.
NTT DATA followed up with buying 79.7% stake in Singapore-Based Apex Systems Pte Ltd, an IT product developer for the insurance industry, with a significant presence in India.
“Keane’s uniqueness since its integration with Caritor has been its exceptional delivery and personalized service through a global presence,” stated Mani Subramanian, chairman of Keane International. “Becoming part of a globally known player like NTT DATA is a natural evolution, helping our clients with an even wider global presence and stronger technical infrastructure backing.”
iQor Buys RMS
iQor Holdings Inc., in which Huntsman Gay Global Capital made a majority investment last month, is acquiring RMS, which was spun off from Dun & Bradstreet in 2001. RMS claims to be one of the largest commercial accounts receivables management (ARM) companies in the
world, with 3,000 employees in the U.S., Canada, Hong Kong, India and Mexico. iQor is backed by Citi Venture Capital International (CVCI) and Starr International Company, Inc. besides Huntsman.
"The acquisition of RMS extends our reach from the business-to-consumer ARM market into the business-to-business ARM market," said Vikas Kapoor, President and CEO of iQor.
"The acquisition will also expand iQor's global footprint in Asia and into Latin America, allowing clients to take advantage of a broader set of skills and labor markets across the world," said Gary
Crittenden, Managing Director of Huntsman Gay.