UK-based outsourcing services provider Xchanging has agreed to acquire 75% stake in India-based BPO and IT services provider Cambridge Solutions for £83m ($145m). It will retain Cambridge’s listing for the outstanding 25% of its shares.
Cambridge Solutions has approximately 4,500 employees at offices in eight countries across four continents. It reported revenue of INR1.23 billion ($258m) for fiscal 2007-08.
Xchanging said it expects the acquisition to be accretive to earnings before one-off costs in the first full year after completion.
David Andrews, chief executive at Xchanging said: This is a unique opportunity to accelerate our strategy to create a global business processor at a time when our industry is internationalizing. We will be able to offer customers both global reach and a proven track record in business processing and IT.
The companies have been working together for the past two years as part of an outsourcing contract for US insurance broker Aon.
Xchanging was founded in 1999 and headquartered in London. The company has over 4,000 employees working at offices the UK, US, France, Germany, India, Malaysia and Australia. Xchanging sponsors the annual University boat race between Oxford and Cambridge, raced along the Thames River in London.
The BPO company operates in the banking and insurance industry as well as offering cross industry processing in Procurement, Finance and Accounting and Human Resources. It reported revenue of £468m in 2007 with a net income of £31.6m in the same period.
In a statement, Scandent Holdings, the majority shareholder of Cambridge Solutions, said: “This offer is a very positive development. Cambridge and Xchanging are complementary businesses that together create a global business processing and IT services leader.”