Tata Consultancy Services, the world-leading IT and consulting organisation, announced that it had bought 100 per cent equity in Comicrom for US $23 million. Comicrom is the market leader in te banking and pensions business process outsourcing business in Chile.
A privately-held company with 1257 employees, Comicrom provides BPO services to banks, insurance companies, pension funds, government bodies and other large corporations in Chile. The company had revenues of US $35.5 million during FY 2005 and operating margins of 14 per cent.
The acquisition enhances TCS' strategy of pioneering the next generation of verticalised, platform-led BPO opportunities. Comicrom is the leading player in the banking BPO sector with a 57 per cent market share of the check processing business in Chile and counts more than 70 per cent of the banks operating in Chile as its customers.
"This acquisition is a further step in realising TCS' strategy of acquiring leadership in platform-based BPO for the banking and Insurance domain. It also expands TCS' capability in terms of becoming a full services player", said S. Ramadorai, CEO and MD of TCS. "Comicrom brings significant capability in transaction-based banking processes and market leadership in Chile", he added.
Following TCS' recent outsourcing engagement with the Pearl Group of the UK, the acquisition of Comicrom further augments TCS' presence in the global Pensions industry. Comicrom is an established player in this sector in Chile, processing 67% and 55% of total premium payments per month for four of the seven pension funds and health insurance providers respectively. This uniquely positions TCS as a high-end, global player in the pensions sector.
N. Chandrasekaran, global head of sales and operations, said: "The acquisition gives another fillip to our strategic initiatives in the transaction-led BPO for the pensions and Insurance sector following the Pearl transaction in the UK." He added: "As a region-wide banking play, the acquisition will drive TCS' growing presence in the region's banking sector, as Comicrom's local expertise combined with TCS' banking domain expertise and assets like Quartz and FNS will enable us to offer the entire range of IT and BPO services to banks in Latin America."
The acquisition of Comicrom will help TCS pursue robust growth in the Latin American region. TCS had announced the setting up of a global delivery center in the state of Sao Paulo, Brazil,to execute the ABN Amro deal in Latin America. This acquisition strengthens its foray in the Latina American BPO market and boosts TCS' regional staff strength to over 2000 and its client base to over 100.
Gabriel Rozman, president, TCS Iberoamerica said: "Comicrom's long-time presence of over 25 years and strong client base gives TCS ready access to local knowledge of the market as well as provides us with deep customer relationships to help drive growth in this entire continent. By combining TCS´ CMMi Level 5 IT service capabilities with Comcirom´s expertise in BPO, we will be able to provide complete solutions and greater business value for TCS and Comicrom´s customers"
Henry Manzano Zahr, CEO of Comicrom said, "We are delighted to become a part of TCS as its global reach will allow Comicrom access to a much larger market. TCS' quality and process competencies will also further improve Comicrom's operational and delivery efficiency, further benefiting our customers."
Comicrom and TCS are currently running a successful joint venture in Chile for IT services, where in Comicrom holds 49 per cent of the equity and TCS, the balance 51 per cent. As part of this transaction, TCS has also bought out Comicrom's stake in its IT services joint venture in Chile.