Blackstone invests $170 million in Kerala-based IBS Software

Industry:    2015-12-17

Private equity (PE) firm Blackstone has committed $170 million (Rs 1,137 crore) investment in Thiruvananthapuram-based information technology services company IBS Software, for a minority shareholding. The PE major is buying out General Atlantic and a few other shareholders, IBS Software said. In 2007, General Atlantic had invested $60 million in IBM Software for a significant minority stake. “Investment by a global Tier-1 PE player is a true endorsement, not only of the relevance and significance of what we do and our financial strength but also a validation of our industry vision, the business model that we operate and standards of corporate governance,” said V K Mathews, founder and executive chairman of IBS Group. “We see a huge synergy from Blackstone’s portfolio of companies and their extensive experience in the travel and hospitality space.” With this investment, Blackstone is seen strengthening its IT portfolio in India. In September this year, the company bought out the private sector business process outsourcing (BPO) operations of UK-based Serco group for £250 million (Rs 2,558 crore). In 2011, Serco had acquired the same piece of business, earlier known as Intelenet, from Blackstone. “IBS is a rare software-as-a-service company with intellectual property in the aviation, travel and hospitality verticals across the globe… We foresee significant growth opportunity for IBS, driven by the company’s deep domain knowledge, its portfolio of products, and roster of referenceable customers,” said Amit Dixit, senior managing director and co-head of private equity in India at Blackstone. Founded in 1997, IBS started operations from Technopark in Kerala. The company, which provides software solutions and services to global travel, transportation and logistics companies, employs around 3,000 people across nine centres in Asia-Pacific, Australia, the US, Europe and Africa. It counts companies such as Nippon Airways, Austrian Airlines, London Heathrow Airport, British Airways, Cathay Pacific, Chevron, China Eastern Airlines, Etihad Airways and Jet Airways as some of its clients. “We are excited to have Blackstone on board as we embark on the next phase of our aggressive growth strategy,” said Rajiv Shah, CEO of IBS Software. “By leveraging Blackstone’s global reach and expertise, we’ll be able to deliver even more long-term value to our employees, customers and shareholders.”

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