Firstsource, 24/7 may merge soon

MUMBAI: The BPO space is set for some big ticket action. While biggies like Infosys and Satyam are eyeing overseas acquisitions, mid-level players are looking to consolidate their positions through mergers. Going by sources, Firstsource (formerly ICICI OneSource), the country’s fifth-largest BPO, and 24/7 Customer, the tenth-largest, could merge soon.

The trigger, according to sources, is Sequoia Capital, which has substantial stakes in both companies. An array of strategic investments have been made in Firstsource by Sequoia, Temasek, Metavante and ICICI.

In June 2003, Sequoia had led the $22 million funding in 24/7 Customer.

Ananda Mukerji, MD and CEO, Firstsource, neither accepted nor denied the talk, but said, “We don’t want to comment on the issue.”

Firstsource employs over 10,717 people, compared to 24/7’s 5,500.

Industry experts say the merger would benefit Firstsource more as it hardly bags orders or clients on its own. Most of its current clients have come from companies it has acquired. It has acquired six firms till date.