The Rs.1,000-crore all-cash deal is expected to be consummated by February 2013, after regulatory clearances.
The U.S.-headquartered Sutherland Global Services, an international provider of business process and technology management services, has piped Genpact and others to the post to ink a Rs.1,000-crore all-cash deal to acquire Apollo Health Street Limited (AHS). An associate company of Apollo Hospitals Enterprises Ltd., AHS is a leading provider of healthcare business services and world-class health information technology (HIT)-based solutions.
Dilip Vellodi, Founder Chairman & CEO of Sutherland Global Services, told this correspondent that the deal would be consummated by February since it had to get regulatory clearances. “With Christmas round the corner, we expect the transaction to close by February,” he said in a telephone conversation.
Sutherland, Mr. Vellodi said, had been focusing on healthcare as a key vertical, and investing heavily in the last few years. “Healthcare market is a sizable business in the U.S., and in some parts of Europe,” he pointed out. In the U.S., especially, the healthcare market was growing due to aging population, and the need to compulsorily provide healthcare insurance (thanks to President Obama), he said.
The acquisition would help Sutherland become a leading healthcare service provider with comprehensive information technology and business process integrated solutions, and consolidate its presence as a dominant player in the $38 billion U.S. healthcare BPO market, he said.
Established in 1986, Sutherland offers an integrated portfolio of analytics-driven back-office and customer-facing solutions that support the entire customer life-cycle. It is one of the largest, independent BPO companies in the world serving global leaders in major industry verticals.
The company has over 30,000 employees globally, working out of 35 operations centres in the U.S., the Philippines, India, the UAE, Egypt, Bulgaria, the U.K., Canada, Jamaica, Mexico, and Colombia.
Apollo Health Street provides customised strategic support services to more than 150 healthcare partners throughout the U.S. from 10 global operational centres of excellence.
Mr. Vallodi said Apollo Health Street had presence in major American cities such as California, New Jersey, Florida and Georgio. “Chennai has been our headquarters for Asia-Pacific region,” he said. With the acquisition of Apollo Health Street, “we will now have a base in Hyderabad as well,” he added.
To a question, he said technology- and platform-based solutions did not require any linear addition to human resources base. Sutherland, he said, was confident of maintaining its 20 per cent growth rate in the coming year as well. In this context, he said Sutherland was confident of scaling revenue of $900 million in 2013. The healthcare vertical’s contribution to the total revenue would be around 15 per cent in 2013, he added. To a query, he said it did not make sense to have two companies functioning in the same vertical. Hence, he indicated that Apollo Health Street would be integrated into the healthcare practice of Sutherland.
To drive Apollo Health Street to the next stage of its evolution, it was essential to find the right strategic partner, a statement quoted Prathap C. Reddy, Founder Chairman of Apollo Hospitals, as saying. “In Sutherland, we found the ideal partner with a proven track record of excellence in services, technology, and leadership. The combined capabilities of both companies will create a compelling value proposition for our clients,” he was quoted as further saying.