EXL set to buy Schneider's back-office unit in Czech

[sukishan]

NEW DELHI: Nasdaq-listed BPO firm ExlService Holdings (EXL) is acquiring the back-office unit of US-based logistics firm Schneider National in Czech 
Republic. The deal size is learnt to be less than $40 million. When contacted , EXL chief executive Rohit Kapoor declined to comment.

The back-office unit in Czech Republic , which employs about 200 people, is managed by Schneider Logistics, the transportation and logistics services arm of the $3.7-billion Schneider National. The unit provides finance and accounting services to logistics firms in Europe in multiple languages such as English, German , French, Italian and Spanish.

EXL, which has nine delivery centres across India and the Philippines, has been trying to enter Eastern Europe. The buyout will provide it access to domain expertise in a relatively new and untapped vertical. EXL, which counts British Gas and Aviva among its clients, is strong in insurance and utilities sectors. The firm, which has guided for revenues of $170-175 million in 2009, has cash reserves of about $112 million.

For EXL, the acquisition comes three years after its purchase of analytics firm Inductis in 2006. Last year, it was in fray to acquire insurer Aviva's captive operations in India and Sri Lanka, which was later bought by WNS for $228 million . It was also eyeing domestic BPO firm InfoVision, in which UK's Serco Group bought 60% stake for about Rs 97.7 crore in December last year.

With the slowdown affecting demand for BPO services such as finance and accounting , customer support and collections , Indian players have been looking at alternative destinations to provide growth. For instance, India's largest BPO firm by revenues, Genpact, is banking on growth markets such as India, China and the Middle East as traditional markets such as the US reel under the downturn.

Eastern Europe, in particular, has been generating a lot of interest among BPO companies, says offshoring advisory firm Quantum Step MD Sridhar Vedala. "Eastern Europe is an attractive BPO destination both due to the language capabilities and the nearshore advantage for catering to markets in Europe," he said.