12 Apr , 2021 By : Kanchan Joshi
Bengaluru: IT company Coforge Ltd is acquiring a controlling stake in SLK Global Solutions, a provider of business process management (BPM) and digital solutions to the financial services industry, for Rs9.2 billion.
Coforge shall initially acquire 60% stake in SLK Global, with SLK Global’s founders completely exiting. Fifth Third Bank’s stake in the company will be reduced to 40% and shall continue at that level for the next two years. Coforge will acquire an additional 20% stake from Fifth Third Bank after the completion of two years.
As part of the transaction, Fifth Third Bank has also committed to remaining a significant customer of SLK Global with a minimum revenue commitment for five years starting FY22.
SLK Global reported consolidated revenue of $62 million during FY20. The business has registered a three-year revenue CAGR of over 17%.
SLK Global’s over 7,000 employees will now be a part of Coforge, and Fifth Third Bank, its long-standing customer and minority shareholder, shall be one of the top five clients.
“We expect very strong business synergies to be generated through this transaction. This differentiated, high growth, margin accretive business further strengthens our position in the North America financial services industry and our BPM business," Sudhir Singh, chief executive officer, Coforge.
“Coforge’s technology and digital capabilities will be highly relevant to SLK Global’s customer base that includes several marquee names in the BFS and insurance industries, while the latter’s capabilities will enable Coforge to compete more effectively for deals that have a major BPM/BPO operations component. SLK Global also provides Coforge with an attractive tier 3 India city delivery location," Singh added.
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