{"id":4639,"date":"2008-10-06T07:50:00","date_gmt":"2008-10-06T07:50:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/cash-is-king-again-as-ma-activity-in-outsourcing-hots-up\/"},"modified":"2008-10-06T07:50:00","modified_gmt":"2008-10-06T07:50:00","slug":"cash-is-king-again-as-ma-activity-in-outsourcing-hots-up","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/cash-is-king-again-as-ma-activity-in-outsourcing-hots-up\/","title":{"rendered":"Cash is king again as M&#038;A activity in outsourcing hots up"},"content":{"rendered":"<p><em><strong><span style=\"COLOR: #0000bf; FONT-FAMILY: Trebuchet MS\">We&#39;ve been talking a lot about <\/span><\/strong><\/em><a href=\"http:\/\/www.horsesforsources.com\/2008\/05\/will-the-eds-ac.html\" target=\"_blank\" rel=\"noopener\"><em><strong><span style=\"COLOR: #c00000; FONT-FAMILY: Trebuchet MS\">consolidation<\/span><\/strong><\/em><\/a><em><strong><span style=\"COLOR: #0000bf; FONT-FAMILY: Trebuchet MS\">&#0160;in the outsourcing industry and when\/how\/if it will happen.&#0160; We can debate for hours&#0160;the strategic benefits&#0160;of service providers of adding niche competences, industry specialization, process acumen and global scale, and whether they should merge, acquire captives, or grow organically through client acquisition to achieve this.&#0160; However, the financial crisis is creating a compelling event to accelerate M&amp;A between service providers.<\/span><\/strong><\/em>&#0160; <\/p>\n<p><a href=\"http:\/\/www.surveymonkey.com\/s.aspx?sm=lsUaBHxVjuES2C2Rlt90CQ_3d_3d\" onclick=\"window.open(this.href,&#39;_blank&#39;,&#39;scrollbars=no,resizable=yes,toolbar=no,directories=no,location=no,menubar=no,status=no,left=0,top=0&#39;); return false\" style=\"FLOAT: right\"><img decoding=\"async\" alt=\"Dollar-bill\" border=\"0\" class=\"at-xid-6a00d8356fb76c69e20105355e1a66970c \" src=\"http:\/\/www.horsesforsources.com\/images\/6a00d8356fb76c69e20105355e1a66970c-800wi.jpg\" style=\"MARGIN: 0px 0px 5px 5px\" title=\"Dollar-bill\" \/><\/a> <a href=\"http:\/\/www.surveymonkey.com\/s.aspx?sm=lsUaBHxVjuES2C2Rlt90CQ_3d_3d\" onclick=\"window.open(this.href,&#39;_blank&#39;,&#39;scrollbars=no,resizable=yes,toolbar=no,directories=no,location=no,menubar=no,status=no,left=0,top=0&#39;); return false\" style=\"FLOAT: right\"><\/a>The amount of consolidation we&#39;re seeing in the financial sector,&#0160;which is&#0160;likely to have knock-on effects into other industries, will drive new&#0160;client needs&#0160;for global sourcing models. Many clients are worried about making large initial capital investments in outsourcing engagements &#8211; especially ones which have complex transition and transformational&#0160;needs, hence those service providers which can help streamline&#0160;these costs over the course of a contract will be successful. Complexity, disruption and increased globalization drive change, and outsourcing is one vehicle that can help many companies reach a global support infrastructure quickly.&#0160; Hence, those service providers with the global scale, competency and financial resources to deliver this quickly will be the winners in this market.<\/p>\n<p>While this industry has ramped-up beyond the wildest expectations over the last 5 years, <\/p>\n<p><!-- pagebreak --><\/p>\n<p>the healthy demand for outsourced services has held back&#0160;a lot of M&amp;A between larger providers, for the simple fact that there has been enough business to go round to enable many service providers to remain independent.&#0160; The recent <a href=\"http:\/\/www.livemint.com\/2008\/10\/03003433\/Axon-prefers-HCL-Infosys-to-w.html?h=A1\" target=\"_blank\" rel=\"noopener\">haggling over Axon Global<\/a>&#0160;by both HCL and Infosys is a signal of the increased stakes for dominance and scale in this market, as the top tier look for larger acquisitions to scale-up even quicker, and valuations drop to more realistic levels.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>We&#39;ve been talking a lot about consolidation&#0160;in the outsourcing industry and when\/how\/if it will happen.&#0160; We can debate for hours&#0160;the&#8230;<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,50,81],"tags":[],"organization":[],"ppma_author":[19],"class_list":["post-4639","post","type-post","status-publish","format-standard","hentry","category-business-process-outsourcing-bpo","category-captives-and-shared-services-strategies","category-it-outsourcing-it-services"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Cash is king again as M&amp;A activity in outsourcing hots up - Horses for 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