A leading Indian pure-play business process outsourcing (BPO) firm, Firstsource Solutions, has emerged as the frontrunner in the quest to buy US-based healthcare player MedAssist. The deal size, say sources, is close to $300 million (around Rs 1,200 crore). If it takes place, the acquisition will be one of the largest overseas aquisitions after Wipro's buyout of Infocrossing for around $600 million, and the largest in the BPO space.
Sources close to the deal say there's one more serious contender in the race for MedAssist which has revenues of $90-100 million and provides provides services in patient services, eligibility services, patient financing and healthcare collections. It has around 1,400 employees and 950 healthcare providers as clients. A Firstsource, when contacted, said: "As a policy, we do not comment on market speculation".
Firstsource is also rumoured to be in the race to acquire Citi's BPO unit after the first round of bidding. The sale of the BPO business, being run by Citigroup Global Services (formerly eServe), is expected to fetch Citi around Rs 3,200 crore. Other bidders include WNS and Genpact.
Around 13 per cent of Firstsource's revenue comes from the healthcare segment. In January this year, it acquired BPM -- a Delaware-based healthcare claims' outsourcing company for around $30 million. Ananda Mukerji, managing director & CEO, Firstsource, had then said, "The healthcare vertical is one of our three focus verticals and represents a high growth area. We also acquire marquee customers, which provide a good opportunity to cross-sell."
During its initial public offering (IPO) in end-January, the Firstsource management had indicated that the company intends to use the net proceeds of the issue to make acquisitions, set up new facilities, repay loan and for general corporate purposes. Out of the proceeds of the IPO, the company plans to spend approximately Rs 180 crore on acquisitions.
The healthcare industry includes pharmaceutical companies, medical device manufacturers, healthcare provider including hospitals, and payors including insurance companies, third-party administrators and employers. Incidentally, around 37 per cent of Firstsource's revenue comes from the banking, financial services and insurance (BFSI) sector. It maintains, however, that the subprime crisis will not affect it. "While we do have one client offering mortgage services, its exposure is restricted to the UK markets," said the spokesperson.
Sources close to the deal say there's one more serious contender in the race for MedAssist which has revenues of $90-100 million and provides provides services in patient services, eligibility services, patient financing and healthcare collections. It has around 1,400 employees and 950 healthcare providers as clients. A Firstsource, when contacted, said: "As a policy, we do not comment on market speculation".
Firstsource is also rumoured to be in the race to acquire Citi's BPO unit after the first round of bidding. The sale of the BPO business, being run by Citigroup Global Services (formerly eServe), is expected to fetch Citi around Rs 3,200 crore. Other bidders include WNS and Genpact.
Around 13 per cent of Firstsource's revenue comes from the healthcare segment. In January this year, it acquired BPM -- a Delaware-based healthcare claims' outsourcing company for around $30 million. Ananda Mukerji, managing director & CEO, Firstsource, had then said, "The healthcare vertical is one of our three focus verticals and represents a high growth area. We also acquire marquee customers, which provide a good opportunity to cross-sell."
During its initial public offering (IPO) in end-January, the Firstsource management had indicated that the company intends to use the net proceeds of the issue to make acquisitions, set up new facilities, repay loan and for general corporate purposes. Out of the proceeds of the IPO, the company plans to spend approximately Rs 180 crore on acquisitions.
The healthcare industry includes pharmaceutical companies, medical device manufacturers, healthcare provider including hospitals, and payors including insurance companies, third-party administrators and employers. Incidentally, around 37 per cent of Firstsource's revenue comes from the banking, financial services and insurance (BFSI) sector. It maintains, however, that the subprime crisis will not affect it. "While we do have one client offering mortgage services, its exposure is restricted to the UK markets," said the spokesperson.
No comments:
Post a Comment