Aditya Birla Minacs eager to acquire BPOs in US, Canada

Aditya Birla Group’s business process outsourcing arm Aditya Birla Minacs is keen to expand via inorganic methods to establish it as a $1-billion turnover tech firm over the next three years. A financial news website quoted the company’s CEO Deepak Patel saying that the BPO firm is exploring opportunities to acquire companies in the insurance, financial services, banking, public and healthcare services in the United States and Canada.

According to Patel, the company aims at attaining a target of $1 billion in revenues not only depending on the anticipated growth rate of the Indian BPO industry, but also through a number of acquisitions. He said that keeping the target in view, Aditya Birla Minacs has already acquired the UK-based Compass BPO in last March and Bureau of Collections Recovery, a US-based accounts receivables management firm, last month spending approximately $35 million. Patel further said that the company intends to raise money through equity or debts to fund its future acquisition plans. Although the BPO firm has set aside cash worth $40 million, Patel says that the funds are basically meant for supporting their existing business and not for funding growth plans.

Meanwhile, Adiya Birla Minacs, which earned revenues to the tune of $350 million during the 2009 fiscal ending on March 31, 2010, expects to sign a number of significant deals worth $1 billion during the next three years. In the last fiscal, the BPO firm, which earns its major share of revenue from the companies in the United States and Canada, signed deals worth $640 million and Patel says that a number of good contracts across different verticals are in the pipeline this year too. In addition to outside contracts, the BPO firm also obtains deals from its parent company – the Aditya Birla Group, which has operations in as many as 25 countries. During the 2009 fiscal, it received contracts worth $25 million from the parent company, Patel said.

Stating that the healthcare sector would be a major contributor for the growth of the Indian BPO firms, Patel said that Aditya Birla Minacs too aimed at establishing a strong base in this domain by acquiring new firms. At the same time, he pointed out that while the banking and financial services industry was doing pretty well, the telecom sector was going slow worldwide.

Aditya Birla Minacs, which presently has 16,000 employees on its rolls, intends to hire another 2,500 people during the 2010 fiscal. At the same time, the BPO firm is spreading out to tier-II and tier-III cities as well as rural areas as a part of the company’s ‘Connect India’ project. Patel said that as per this model, his company not only expects to set up operation centers in Baroda, Aurangabad, Kolkata, Mumbai and Chennai, but also set up hubs having 100-150 seats in smaller cities like Ranchi, Anand and Bhilwara.