Roy’s Quatrro buys 100% in Flextronics’ BPO arm
In its first 100% takeover of a business Raman Roy-promoted Quatrro has acquired the BPO arm of Flextronics Software Systems (FSS) along with 120 employees in its technical support function.
The two companies have also entered into strategic alliance under which Flextronics would refer any BPO requirements of IT clients to Quatrro, while Quatrro would influence IT services requirements of its BPO clients to FSS.
“Following the buyout, the BPO business will be brought under AuxiCogent, the joint venture company of Quatrro and John Keells (a shipping and port company). The acquisition will strengthen our abilities to pursue platform-based products targeting US customers,” Quatrro CMD Raman Roy said but declined to divulge the size of the acquisition.
Interestingly, early this year US private equity firm KKR had bought out FSS in a $900m deal. Flextronics’ BPO business came to KKR via this acquisition.
Although the deal is the third investment by Quatrro in a BPO entity, it marks Quatrro’s first ever 100% buyout. Quatrro’s investments include a 40% stake in Anik Technologies and 22% in Auxicogent, the BPO division of John Keells. Quatrro already has a team of 500, with operations in Delhi, Gurgaon, Colombo, Singapore and the US.
With the buyout, the BPO work done by FSS for its existing client HNS would also move to Quatrro. Mr Roy said AuxiCogent has committed $22m for development of BPO business.
Quatrro is currently flush with funds and has tied up close to $250m. It may be recalled that last month Asia-focused fund Olympus Capital announced it would invest $100m in Quatrro BPO Solutions for a ‘significant minority stake’.
Quatrro, which will have multiple BPO companies focusing on areas like equity research, finance and accounts, risk
management and shipping, seeks to use the funds to acquire companies, incubate new ventures and provide a platform for entrepreneurs to kick off high-end BPO operations. The multiple BPO strategy under one roof will help the company share common costs and leverage bandwidth, facility, transport and other infrastructure.
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