CBaySystems keen to list on Indian bourses

"We have plans for listing on the Indian bourses. We are looking at further expansion of our infrastructure in the country, for which we need to raise capital locally. With our turnover to double next year, the opportunity for growth also increases," said Raman Kumar, Chairman and CEO, CbaySystems. The revenues from India operations are about Rs 120 crore and are expected to double by next year.

The company is planning to expand operations in Ahmedabad, as well as its Nagpur and Vizag centres. It also intends to build a campus in Hyderabad SEZ with a capacity of 2,000 people. The company has centres at Vijayawada, Guwahati and Hubli.

CBaySystems Holding, the parent company of CBaySytems India, is listed on the AIM platform of London Stock Exchange (LSE). The parent company will relist on the LSE after completing the recent acquisition of MedQuist, a Philips company. "With this acquisition, our turnover will move from $70 million to $400 million. We hence feel the company needs to be on the mainboard," said Kumar.

Lehman Brothers and SAC Private Capital Group hold over 55 per cent stake in the holding company. Both these players had invested $123 million in CBay, which was used for the MedQuist acquisition. Other shareholders in the company are Godrej Industries, GMO and Kingdon Capital.

The company will continue to look at fresh buys. "Acquisition remains a focus. We are looking for companies with capabilities in the medical transcription space, including receivable management. These could either be BPOs or companies with technology skills," said Kumar.

The MedQuist buy catapults CBaySystems into a leading position in the medical transcription business. MedQuist has nearly 8,000 employees in the US and this would boost the revenues of CBay Systems Holdings to $400 million (around Rs 1,680 crore) for this year. The company's revenue for the quarter ended December 31, 2007 was $57.7 million (around Rs 242 crore).

CBay's headcount in India is 5,500 and the acquisition will bolster its Indian operations. "We have still not decided whether MedQuist's work will be offshored. The decision has to come from the company's management team.

About 6-7 per cent of the business currently comes to India. If we get 10 per cent of the work to India to leverage the offshore capability of CBaySystems, it will be worth $30 million," said Kumar.