HOV Services has signed an agreement to combine its subsidiary HOV Services LLC with Sourcecorp. The combined entity is expected to clock revenues of over USD 481 million.
In an interview with CNBC-TV18, Sunil Rajadhyaksha, MD, HOV Services spoke on the joint venture and the road ahead. Below is a verbatim transcript. Also watch the accompanying video. Q: Could you tell us what this 50-50 JV that you have gotten into with Sourcecorp, what will it mean in terms of revenues and this combined entity, what will its financials look like? A: We are combining our indirect subsidiary HOV services LLC with Sourcecorp in a new company called HCA Services Inc. SCH Services Inc will have USD 481 million in revenue. Previously HOV Services LLC had USD 159 million in revenue. Q: Post this entire restructuring process what would the shareholding look like? A: Shareholders of HOV services held 100% of its indirect subsidiary before and with the new structure the shareholders of HOV services will hold in SCH Services Inc 50% shares. Q: You have also indicated that this entire merger should be completed in the next 45-60 days, which means that in FY12 the full financial impact will be visible on your books. So from Rs 850 crore that you did in FY10, could you give us some sort of projections for FY11 and FY12? A: I think that is a forward looking statement. So after closing we will take a call again and I can update you then. Q: Can you take us through the rationale behind this restructuring? A: We were a diversified BPO player. Sourcecorp is also a diversified BPO player and with this merger we are creating a global BPO player with synergies and operating synergies which will create value for our shareholders. Q: You have indicated that you have already secured debt financing of USD 625 million. WhatDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
