Thursday, February 1, 2007

Oak Hill Partners may merge portfolio companies Genpact and Vertex; merged entity to be listed

US-based private equity firm Oak Hill Capital Partners is reportedly working on merging its two BPO portfolio companies, Genpact and Vertex Data Systems.

Oak Hill and General Atlantic bought 60% in Genpact in 2004 from GE for around $500 mn. Vertex Data Systems, a BPO subsidiary of UK-based United Utilities, was bought out by an Oak Hill-led consortium comprising GenNx360 and Knox Lawrence International in a $425 mn cash, debt-and-liability readjustment deal.

Genpact employs around 27,000 people and has a dominant presence in India and operations in China, Hungary, the Philippines, Romania, the US and Mexico. It serves the banking/financial services, insurance, manufacturing, transportation, automotive and business services verticals. Genpact is understood to have revenues of close to $650 mn (Rs. 3000 crores) and is targeting $1 bn by 2008.

Vertex has around 9000 employees, roughly 1500 of them in India, with 12 units in Europe, the US, India and Canada. It offers a range of services across private enterprise, financial services, utilities, and central and local government sectors.

The merged entity would raise an initial public offering (IPO) that may be listed on a foreign or domestic bourse. The merger will allow investors to maximize efficiencies in the two companies’ overlapping verticals and geographies and leverage their separate areas of expertise.

Read the Business Standard article.

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