Citigroup is keen on selling an 80% stake in Mumbai-based captive business process outsourcing (BPO) arm Citigroup Global Services (formerly eServe International) for $700-750 million (Rs2,870-3,075 crore) and is in advanced negotiations with leading private equity investors for an all-cash deal.
a private equity investor is most likely to emerge as the buyer and strategic suitors, such as IBM Corp. and Tata Consultancy Services Ltd, (TCS) are likely to drop out of the race over terms being proposed by the seller. Unlike the Genpact deal, Citi is not willing to commit long-term business to the captive once a new shareholder comes in. Neither IBM nor TCS would be willing to put so much cash down without that commitment. When General Electric Co sold 60% in its Gurgaon-based captive BPO to PE firms General Atlantic and Oak Investment for $500 million, it also threw in a multi-year outsourcing contract as part of the deal.
(Source: Mint)
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