The race for Citigroup Global Services, the business process outsourcing arm of Citigroup is hotting up with the entry of the BPO firm WNS and consultancy firm Accenture.
Sources close to the development said these were the latest entrants into the fray. The list of suitors includes IBM, Automatic Data Processing, Infosys, EDS, Genpact, Capgemini and private equity players such as Blackstone and General Atlantic. A Citigroup spokesperson declined to comment.
Although there was no official confirmation on the impending sale of Citigroup's business processing arm, sources in the know said Citi might receive Rs 3,000 crore (Rs 30 billion) from divesting this non-core area of its business.
Sources said Citigroup might sell 80 per cent stake in the BPO firm currently and pull out at the time of listing after divestment. Citigroup might induct a strategic partner for the BPO arm, they added.
Citigroup Global Services, which changed its name from e-Serve in November, employs close to 8,000 people in Mumbai and Chennai.
Blackstone bought Intelenet from Backlays and HDFC on Sunday. In 2001, HCL Technologies acquired the majority stake from Deutsche Bank's BPO arm and acquired the remaining 49 per cent in 2005.
In 2002, it was the turn of Mumbai-based WNS Holdings and in 2004, GE Capital International Services divested 60 per cent stake in its BPO arm (now renamed Genpact) to General Atlantic and Oak Hill Capital Partners.
Sudin Apte, senior analyst and country head, stated in a recent Forrester report on captive units, "Over the next three years, at least 40-60 per cent of the current captives would have embarked on some exit strategies, and for the next year, expect the number of new centres to gradually taper off as news about the struggling existing centres gets around."