WNS Clinches US $1bn BPO Deal with Aviva
Global business process outsourcing (BPO) services provider WNS has acquired Aviva Global Services. Under a share sale and purchase agreement, backed by a Master Services Agreement (MSA), WNS will acquire Aviva’s off shore operations.
“With this acquisition, WNS solidifies its position as a premier offshore BPO provider. Aside from a large BPO contract, this significantly accretive acquisition promotes our strategy of expanding market share in target industries, greatly extends our scale, and bolsters our service offerings — not just in the insurance industry, but across all our businesses, said Neeraj Bhargava, CEO of WNS Global Services.
Since 2004, WNS has provided BPO services to Aviva pursuant to Build-Operate-Transfer (BOT) contracts from facilities in Pune, India and Colombo, Sri Lanka. With this deal, WNS will take over AGS operations comprising over 5800 seats. Operations include the control of AGS’s captive operations in Bangalore and Colombo, transfer of AGS’s Pune and Chennai operations, which are run by other providers within 30 days. In this regard, AGS has issued transfer notices to these third party providers.
Earlier, the WNS-managed Colombo facility was transferred to AGS in July 2007. In addition, the Pune facility is managed by WNS and will remain with the company.
Under the Master Services Agreement (MSA), WNS will be the long-term strategic BPO services provider to Aviva’s UK and Canadian businesses. Other providers will be capped on numbers and duration as per existing contracts. With the MSA, WNS also will benefits from a recently signed AGS contract for nearly 580 employees with Aviva’s Irish subsidiary, Hibernian. Based on the likely service needs of these businesses, as provided by Aviva, WNS estimates that the MSA could generate nearly US $1 billion revenues over the contract life.
The total purchase consideration paid to Aviva for the deal is about GBP 115 million (US $228 million), subject to adjustments for cash and debt. WNS funded the deal under cash and a bank loan of about US $200 million.
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