Bhasin: New feather in cap

Mumbai, April 6: Outsourcing firm Genpact today announced that it was acquiring Headstrong Corporation, which has offshore centres in India and Manila, for $550 million in an all-cash deal.

The acquisition is expected to strengthen Genpact’s capabilities in capital markets and health care verticals.

Genpact, which is the largest outsourcing company in India and listed on the New York Stock Exchange (NYSE), said the transaction would be earnings accretive in 2011.

It added that the transaction was being funded by a combination of cash in its books and acquisition financing.

The transaction is expected to close by May 31, subject to customary regulatory and other conditions.

Headstrong is a global consulting and IT services company with a specialised focus in financial services. It is also a leading offshore outsourcing company for the capital markets and securities industry.

The company has operations in seven countries, including offshore centres in India and Manila, with more than 3,700 employees globally.

Headstrong generated revenues of $217 million in 2010 and Genpact expects Headstrong’s long-term growth rate to be over 20 per cent annually.

Genpact was spun off from General Electric (GE) in 2005 and the parent is now the company’s largest client. Besides banking, financial services and insurance, manufacturing accounts for a large portion of Genpact’s revenues in terms of industry verticals.

“Headstrong is a complementary high-growth business, that is an excellent fit strategically, financially, operationally and culturally. With this acquisition, we are gaining critical domain and technology expertise in the complex, but highly attractive, capital markets industry vertical. This expertise — combined with our capabilities in business process management — will create a uniquely powerful value proposition for clients,” said Genpact CEO and president Pramod Bhasin.