HDFC, Barclays exit Intelenet BPO

Housing Development Finance Corporation (HDFC) and Barclays Bank today agreed to sell their entire shareholding in Intelenet Global Services, an India-based business process outsourcing (BPO) operation, to SKR BPO Services.

While there is no confirmation on the deal amount, sources say it is pegged around $200 million (Rs 820 crore), which will make it the largest BPO deal in the country.

SKR BPO Services is jointly owned by the management of Intelenet and Blackstone GVP Capital Partners. Intelenet has over 60 Indian and international clients and employs more than 17,000 people in 18 offices in India and overseas.

The 50:50 joint venture, established in 2004, by Barclays and HDFC, has gross assets of $107 million (around Rs 410 crore).

Following the transaction, Intelenet will continue to provide services to Barclays in relation to certain processes currently offshored to India.

It has also agreed to assist Barclays in establishing a wholly owned BPO operation in India, which will serve the incremental offshoring requirements of Barclays.

Intelenet, sources say, may reduce its exposure to Barclays since around 70 per cent of its revenues (around Rs 410 crore) currently come from Barclays.

Meanwhile, Sparsh BPO Services has been informed by the board of directors of SKR BPO Services that it has resolved to execute the share purchase agreement to buy 68.39 million equity shares (being 100 per cent of the voting capital) of Intelenet, which holds 51 per cent of the voting capital of the company.

Since the acquisition of Intelenet's equity shares by SKR BPO Services results in an indirect acquisition of control of the company, SKR BPO will make an open offer to purchase up to 3.23 million fully paid-up equity shares (20 per cent of the issued share capital of the company) at an offer price of Rs 200 a share for a total offer of approximately Rs 64.59 crore.

Renu S Kamad, executive director, HDFC, said: "HDFC launched Intelenet at a time when the BPO sector was developing rapidly. We are happy to have been associated with Intelenet in its journey towards growth and leadership in the BPO industry. The BPO business today needs more focus and we believe the new arrangement will provide the right impetus. We see the development as a win-win for all of us. We wish the management of lntelenet all success."

Intelenet started out in 1994 as a 50:50 joint venture between Tata Consultancy Services (TCS) and HDFC.

In 2004, TCS sold its stake to HDFC for Rs 161 crore when it decided to focus on its own BPO business. Subsequently, HDFC sold 50 per cent to the UK-based Barclays, which was looking to outsource back-office processes to India.

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OUT OF ACTION

HDFC and Barclays Bank agreed to sell their entire shareholding in Intelenet Global Services to SKR BPO Services for an unconfirmed amount of Rs 820 crore

SKR BPO Services is jointly owned by the management of Intelenet and Blackstone GVP Capital Partners

Intelenet has over 60 Indian and international clients and employs more than 17,000 people in 18 offices in India and overseas