Aditya Birla Minacs, an information technology business solutions company and a subsidiary of Aditya Birla Nuvo Ltd, today announced the acquisition of US-based Bureau of Collections Recovery, an accounts receivables management company, in an all-cash transaction. However, the deal amount was not disclosed.
This is the second acquisition by Aditya Birla Minacs in three months, after it acquired UK-based Compass BPO in March.
With the acquisition of BCR, Minacs will have presence in the collections segment. BCR is a $20-million (around Rs 90 crore) revenue company, with an earnings before interest, taxes, depreciation and amortisation (Ebitda) of 17-18 per cent. BCR has 600 employees, with two centres in the US and a captive unit in Delhi.
BCR has clients in the banking, financial services and telecom sectors. It provides services in first-party, early out and third-party collections across various stages of delinquency as well as in pre charge-off, primary and secondary post-charge off collections.
Post-acquisition, BCR would operate as a subsidiary of Aditya Birla Minacs. BCR's centres in Eden Prairie and Willmar, Minnesota will join Aditya Birla Minacs' global network of 30 delivery centres across three continents.
"The acquisition is part of the road map we have created. Besides customers have been asking for such services. The collections business is an attractive market and we have already started to build organically the business. We have signed up a few customers for the collections business other than the 16 that we acquired from BCR," said Deepak Patel, chief executive officer, Aditya Birla Minacs.
Before BCR's acquisition, it had centres in Jamaica, Bangalore and the Philippines that were handling the collections business.
The US debt collection industry, valued over $12 billion, is expected to grow at 12 per cent compounded annual growth rate. Aditya Birla Minacs, which reported a revenue of Rs 1,520 crore for 2009-10, expects its revenue to see a double-digit growth fuelled by acquisitions.
Patel also pointed out that the acquisition fit into the company's plan to be a $1-billion company by 2013. "We will look at both tuck-in acquisitions as well as something that will allow us to leapfrog to achieve this target. But, our focus is not to make these acquisition to add to the top line alone, but something that gives us entry into sectors and acquire skill-sets that compliment our offering."
Other than taking the inorganic route to be a $1-billion company, Aditya Birla Minacs is also planning to broaden its portfolio by entering into adjacent areas of their current offerings. It is also working towards getting a bigger pie of work from the Aditya Birla Nuvo group companies. About 4,000 employees provide support to the group.
