IBM buys Daksh

The Indian BPO space is now being truly globalised. IBM has bought Daksh, one of India’s largest call-centre companies for an estimated price of between Rs 650-800 crore (USD 140-175 million). Daksh’s revenues were about USD 60 million, and employs over 6,000 people. Adds WSJ:

Founded in 2000, closely held Daksh was one of the first independent companies to cash in on India’s abundance of young, English-speaking workers. During the past four years, three investment firms — CDC Capital Partners of Britain, a private-equity arm of Citigroup Inc. and General Atlantic Partners of the U.S. — together have invested $29 million in Daksh. They should profit significantly from IBM’s acquisition.

IBM’s purchase of Daksh could spark further consolidation in India’s call-center and back-office business, valued at $3.5 billion in annual revenue. Some companies are looking to be acquired; others are considering public offerings. The industry encompasses services including typical call-center work answering customer queries and more complex areas such as payroll processing and accounting.

A spokesman said IBM expects to expand Daksh’s business with existing international customers and inside the fast-growing Indian market. IBM plans to boost Daksh’s back-office services, such as handling financial transactions and handling supply-chain functions, rather than its basic call-center operations.

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Rajesh Jain

An Entrepreneur based in Mumbai, India.