Tech Mahindra on Monday outbid L&T and others and won the Satyam bid, as per CNBC TV report
According to CNBC , Tech Mahindra will pay Rs 1757cr for 31% stake in Satyam. It will pay Rs 58 per share of the company. Meanwhile engineering firm L&T reportedly made an offer of around Rs 49 for each Satyam share.
As per TOI , L&T, Tech Mahindra and Wilbur Ross had all put in technical and financial bid for Satyam Computer Services earlier on Monday.
BK Modi's Spice Corp did not submita bid for Satyam. "We have not submitted bid for Satyam. Our board wanted e-auction and since there is no e-auction, so we decided not to participate in the process," Spice Corp chairman B K Modi said.
According to PTI sources, Cognizant Technologies also did not put in its bid to acquire stake in the firm.
Monday, April 13, 2009
Thursday, October 30, 2008
The Meltdown and Career with BPOs
Everyone today is wondering how the global financial crisis will negatively impact Indian business process outsourcing (BPO) companies. But what exactly is the crisis and how was it caused? Why are the BPO Companies so susceptible to something happening on the shore of the Americas? Read on to figure out why the BPO honchos are so worried and how it will impact employees.
The Financial Meltdown: Sub-prime Story
For years, banks in the US have been lending out huge sums of money in the form of sub-prime mortgages commonly known in India as Home Loans. These mortgages are given to people who, by definition, are unlikely to repay them, i.e. where the risk of the debtor defaulting is relatively high and debt settlement may become an issue. Since housing prices were consistently rising, the banks did not perceive a lot of risk: since if the debtor defaulted on the loan, the bank could simply seize and sell the house and not incur a loss.
Then, house prices in the US started falling. And kept on falling. As a result the banks couldn't recover the loans from their debtors and started losing huge amounts of money. In a world where commerce is delicately interlinked, these losses had a domino effect. Lehman Brothers collapsed. Morgan Stanley faltered. The US government recently spent $700 billion bailing the banks out. Despite the government's intervention, the damage is likely to be unforgettably huge. The people on the other hand have to handle diluted valuations and a financial crunch due to which they are being unable to handle mortgage payments. As a result they are resorting to means like debt negotiation to keep liquid and not have to declare bankruptcy.
How Does it Impact India and Your Job?
USA today contributes to the tune of 60% of Indian BPO revenues. However, the same corporations will now be under tremendous amount of pressure to shed fat and trim the corners with customer care and back office processes like data entry services, medical billing and coding etc being first to go. Since the US is one of the largest contributor to Indian BPO/KPO companies the impact will be directly felt here. Though functions like legal process outsourcing or litigation coding may get spared due to the high end nature of each transaction.
A website called BPOVoice has an article published that states Country's fourth largest software exporter Satyam Computer has put about 2,500 employees under 'Performance Improvement' programme. Terming it as a regular exercise, a Satyam spokesperson said in an e-mailed statement that "as part of our appraisal process we identify around 5 per cent of our associates in the Performance Improvement category and put them through a structured Performance Improvement Program". Though termed as routine, according to industry sources the exercise is a result of Satyam trying to effectively utilising its bench strength.
Will This Have a Postive Impact in the Long Run?
Well yes and maybe. A report by the Everest Research Institute states "business process outsourcing (BPO) from the financial services sector will increase 40 to 45 times the current market size over the next five years, with key drivers of growth coming from cost pressures". In other words, under pressure to cut costs and stay afloat, these companies may shift out more and more functions. But this is yet to be seen.
The Financial Meltdown: Sub-prime Story
For years, banks in the US have been lending out huge sums of money in the form of sub-prime mortgages commonly known in India as Home Loans. These mortgages are given to people who, by definition, are unlikely to repay them, i.e. where the risk of the debtor defaulting is relatively high and debt settlement may become an issue. Since housing prices were consistently rising, the banks did not perceive a lot of risk: since if the debtor defaulted on the loan, the bank could simply seize and sell the house and not incur a loss.
Then, house prices in the US started falling. And kept on falling. As a result the banks couldn't recover the loans from their debtors and started losing huge amounts of money. In a world where commerce is delicately interlinked, these losses had a domino effect. Lehman Brothers collapsed. Morgan Stanley faltered. The US government recently spent $700 billion bailing the banks out. Despite the government's intervention, the damage is likely to be unforgettably huge. The people on the other hand have to handle diluted valuations and a financial crunch due to which they are being unable to handle mortgage payments. As a result they are resorting to means like debt negotiation to keep liquid and not have to declare bankruptcy.
How Does it Impact India and Your Job?
USA today contributes to the tune of 60% of Indian BPO revenues. However, the same corporations will now be under tremendous amount of pressure to shed fat and trim the corners with customer care and back office processes like data entry services, medical billing and coding etc being first to go. Since the US is one of the largest contributor to Indian BPO/KPO companies the impact will be directly felt here. Though functions like legal process outsourcing or litigation coding may get spared due to the high end nature of each transaction.
A website called BPOVoice has an article published that states Country's fourth largest software exporter Satyam Computer has put about 2,500 employees under 'Performance Improvement' programme. Terming it as a regular exercise, a Satyam spokesperson said in an e-mailed statement that "as part of our appraisal process we identify around 5 per cent of our associates in the Performance Improvement category and put them through a structured Performance Improvement Program". Though termed as routine, according to industry sources the exercise is a result of Satyam trying to effectively utilising its bench strength.
Will This Have a Postive Impact in the Long Run?
Well yes and maybe. A report by the Everest Research Institute states "business process outsourcing (BPO) from the financial services sector will increase 40 to 45 times the current market size over the next five years, with key drivers of growth coming from cost pressures". In other words, under pressure to cut costs and stay afloat, these companies may shift out more and more functions. But this is yet to be seen.
Monday, October 27, 2008
US Financial Meltdown, Economic Recession & Outsourcing
It seems that growth prospects for the business process outsourcing (BPO) industry remain bright despite a general slowdown in the global economy. Terms like US Financial Meltdown, Economic Recession would be like sing songs to the Indian BPOs who would be looking at grabbing a pie of the BPO businesses as US businesses would need to become leaner to effectively manage their costs without compromising on quality.
US companies are under tremendous pressure to reduce cost and increase revenue and therefore the impact on business process outsourcing would be fairly obvious. The need to offshore and outsource non core but essential business processes will stem from the need to cut costs and rationalize resources. Outsourcing will grow as this helps organizations to become nimble and efficient by offshoring as these are non-discretionary spending especially on IT. and related services. In the immediate to short term there will be pricing pressures that the service providers will have to combat.
During the Call Center Expo and Conference held recently, executives from call center companies said they believe that the ongoing recession in the United States, where a huge chunk of Philippine business process outsourcing or BPO clients are, will be beneficial in the long run since it will create more opportunities for the country.
Dan Reyes, president of Sitel and director of the Contact Center Association of the Philippines (CCAP) said that the US recession may have some negative impact only in the immediate term.
Lets wait and watch as the data entry of statistics is done and results are collated.
US companies are under tremendous pressure to reduce cost and increase revenue and therefore the impact on business process outsourcing would be fairly obvious. The need to offshore and outsource non core but essential business processes will stem from the need to cut costs and rationalize resources. Outsourcing will grow as this helps organizations to become nimble and efficient by offshoring as these are non-discretionary spending especially on IT. and related services. In the immediate to short term there will be pricing pressures that the service providers will have to combat.
During the Call Center Expo and Conference held recently, executives from call center companies said they believe that the ongoing recession in the United States, where a huge chunk of Philippine business process outsourcing or BPO clients are, will be beneficial in the long run since it will create more opportunities for the country.
Dan Reyes, president of Sitel and director of the Contact Center Association of the Philippines (CCAP) said that the US recession may have some negative impact only in the immediate term.
Lets wait and watch as the data entry of statistics is done and results are collated.
Obama vows to curb outsourcing
Mon, Oct 27 12:18 PM Financial Express
Sitting politically 'pretty' with only a week to go for Presidential polls, the Democratic nominee Barack Obama has kept hammering away with his theme of creating jobs and curbing outsourcing and blamed the Republicans for the mess America finds itself in.
Back on the campaign trail after a short break in Hawaii to see his ailing maternal grand mother, Senator Obama was in the "Red" state of Colorado pushing his economic plans.
Holding the Bush administration and by extension his Republican rival John McCain for the current economic recess, Obama said, "It's time to turn the page on eight years of economic policies that put Wall Street before Main Street but ended up hurting both."
"We need policies that grow our economy from the bottom-up, so that every American, everywhere, has the chance to get ahead -- not just the person who owns the factory, but the men and women who work on its floor; not just the CEO, but the secretary and the janitor," he said in Denver.
The Illinois Senator said, "If we've learnt anything from this economic crisis, it's that we're all connected; we're all in this together; and we will rise or fall as one nation as one people. The rescue plan that passed the Congress was a necessary first step to easing this credit crisis, but if we're going to rebuild this economy from the bottom up, we need an immediate rescue plan for the middle-class, and that's what I will do as President of the United States" he added.
Keeping his rhetoric on outsourcing alive, Obama said, "I've proposed a new American jobs tax credit for each new employee that companies hire here in the United States over the next two years. I'll stop giving tax breaks to companies that ship jobs overseas and invest in companies that create good jobs right here in Colorado."
Obama said, "I won't let banks and lenders off the hook when it was their greed and irresponsibility that got us into this mess. We should not be bailing out Wall Street; we should be restoring opportunity on Main Street."
"...For the last eight years, we have tried it John McCain's way. We have tried it George Bush's way. We've given more and more to those with the most and hoped that prosperity would trickle down to everyone else. And guess what? It didn't. So it's time to try something new. It's time to grow this economy by investing in the middle class again.
"If I am President, I will invest USD 15 billion a year in renewable sources of energy to create five million new, green jobs over the next decade -- jobs that pay well and can't be outsourced; jobs building solar panels and wind turbines and fuel-efficient cars; jobs that will help us end our dependence on oil from Middle East dictators," he added.
Even the lowest of estimates in the Electoral College vote in the various scenarios have shown Obama winning 270 votes that are needed quite easily and projections for the
Democratic nominee have even gone in the upwards of 360 which will point to a landslide that has not been witnessed for quite sometime now.
The clear edge to the Democrat candidate at the Presidential level will be impacting the races for the United States Congress as well and the Democrats are looking to "unleash a bloodbath in the House of Representatives and the Senate."
In the House, the Democrats are expected to be picking up between 25 to 30 seats from the current strength of 235; and in the Senate the party is looking at a Cloture proof majority of 60 seats or up by 11 from the current position.
Link to original article: Obama vows to curb outsourcing
Saturday, October 18, 2008
Debt Collection & India
the New York Times reports. Indian collectors are “very polite, very respectful, and they don’t raise their voice,” says one CEO. And a big payout in India can be a quarter of the salary American collectors expect.
Ever since outsourcing to India took off in a big way, Americans have been used to receiving calls from India for health care claims, calling cards and credit card sales. However debt collection today has become a big business for business process outsourcing companies in India. Especially as the American economy slows down, its consumers are finding it difficult to pay for their purchases. While country cousin mortgage loans involve complex state and national laws for collections, they are almost always handled by debt collection companies using their teams in the United States. Credit card, auto and other sundry debts have become prime candidates for collection from overseas BPO centers.
As the US financial crisis plunges Americans into debt, the debt collection business today is one of the fastest growing sectors in Indian outsourcing. Though its good for Indian BPOs the agents are on the receiving side of the crisis with frequent cries of "how do you expect me to pay, i don't even have money to eat" and even more frequent claims of declaring bankruptcy after trying all means of debt consolidation through debt settlement companies, that is if they manage to reach the debtor. In most cases debtors have moved houses or changed their numbers adding to the woes of collectors. However industry experts feel, that the debt collection business will continue to grow as debt rises and companies look to cut costs and find more innovative and cost effective means to collect on their debt.
How does this impact the debt collectors? Have they wisened up to the debt economy, do they themselves pay off their credit card bills and other payments religiously? Have they vowed to stay clean of debt? Or will they also receive a collection call one of these days as banks and FIs fight to stay liquid.
Ever since outsourcing to India took off in a big way, Americans have been used to receiving calls from India for health care claims, calling cards and credit card sales. However debt collection today has become a big business for business process outsourcing companies in India. Especially as the American economy slows down, its consumers are finding it difficult to pay for their purchases. While country cousin mortgage loans involve complex state and national laws for collections, they are almost always handled by debt collection companies using their teams in the United States. Credit card, auto and other sundry debts have become prime candidates for collection from overseas BPO centers.
As the US financial crisis plunges Americans into debt, the debt collection business today is one of the fastest growing sectors in Indian outsourcing. Though its good for Indian BPOs the agents are on the receiving side of the crisis with frequent cries of "how do you expect me to pay, i don't even have money to eat" and even more frequent claims of declaring bankruptcy after trying all means of debt consolidation through debt settlement companies, that is if they manage to reach the debtor. In most cases debtors have moved houses or changed their numbers adding to the woes of collectors. However industry experts feel, that the debt collection business will continue to grow as debt rises and companies look to cut costs and find more innovative and cost effective means to collect on their debt.
How does this impact the debt collectors? Have they wisened up to the debt economy, do they themselves pay off their credit card bills and other payments religiously? Have they vowed to stay clean of debt? Or will they also receive a collection call one of these days as banks and FIs fight to stay liquid.
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