PeopleSupport eyes further expansion in RP

Posted August 19, 2008

MANILA, Philippines -- PeopleSupport is looking to expand further its operations in the Philippines following its acquisition by Indian business conglomerate Essar Group, the company's top local official said.

Essar Group, through its subsidiary BPO, has acquired PeopleSupport at $12.25 per share or approximately $250 million. Nasdaq-listed PeopleSupport Inc. operates six call center facilities in the Philippines with around 20,000 workers.

Aegis BPO, meanwhile, operates 25 delivery centers in the United States and India. The company reported annual revenues of $320 million.

Under the deal, PeopleSupport will be de-listed and the new company Aegis People Support will be a wholly owned unit of Aegis BPO. The new company will have a combined workforce of around 29,000 employees in India, US, Philippines and Costa Rica.

The deal is expected to close around third quarter of this year pending regulatory and shareholder approval.

Bong Borja, PeopleSupport Philippines managing director, said there will be no changes in the company's local operations, including its top executives.

Borja said the merger will enable the company to leverage on business prospects offered by its parent firm Aegis BPO, which services customers in the telecom, banking and healthcare industries.

“At some point, this will also allow the company to touch on some part of Essar,” Borja said in a briefing with reporters Tuesday.

Essar Group is regarded as one of India's largest conglomerates employing more than 38,000 people in power, communications, shipping and logistics and construction, among others.

Borja, meanwhile, is forecasting P160 million in revenues this year. “We could be a lot more aggressive now,” he answered, when asked how the merger would affect PeopleSupport's expansion in the country.

The company is currently ramping up operations in Baguio City, where it operates two call centers.

“We have a total capacity of 1,500 seats but so far we have filled up only half of it. We're looking to fill up capacity before year-end,” Borja said.

Source:I nquirer.net, August 08, 2008
by Lawrence Casiraya