Aegis invests in local BPO

Johannesburg, 10 Jul 2009

Indian outsourcing company Aegis has bought the Call Centre Nucleus (CCN) Group and says it will invest R500 million in local operations over the next three years.

The business process outsourcing (BPO) division of the Essar Group has acquired 100% of the local call centre company and says the acquisition made strategic sense. It intends to use CCN as a platform to grow further and build a call centre base for itself locally.

“We are using CCN as a vehicle because it's an excellent company to attract more customers. We believe that once we achieve a certain size, you get economies of scale, and you are able to attract those large companies,” says Aparup Sengupta, global CEO and MD of Aegis.

The BPO company says it aims to create at least 5 000 jobs in the near term in 18 to 24 months, depending on how fast operations move. CCN currently employs around 1 000 people.

The company has been aggressively expanding its global operation. This would be the 12th acquisition for Aegis in the last four years. The company completed the acquisition of PeopleSupport, a Nasdaq-listed outsourcing firm, in October 2008. It's acquisition of UCMS, in Australia, is still awaiting regulatory approval.

Sengupta explains the local acquisition was because Aegis sees SA as an attractive market for its offshore business operations.

“SA becomes an integral part of our growth strategy and offers an opportunity for Aegis to develop skills, create employment and bring international experience to SA."

Local operations

Sengupta says the company is looking at other acquisitions and new ways of growing their call centre operations locally. He says he is always on the look out for good investments and, if there are good companies in the local market, Aegis would consider acquiring them.

Aegis says it will look to boost its South African operations by attracting large telecom companies and banks from the UK, as well as energy companies based in the UK. Locally, its focus would be on government operations and large companies in the financial and telecoms sectors.

“We believe there's a big market for BPO and the contact centre industry in SA. I think we have the size and skill to attract large global companies. We are speaking at this point in time to many of them and we've received a very good response. We also believe we can increase the domestic market and also add onto that the international business.”

Sengupta adds that, as far as telecommunications costs are concerned, prices are set to go down and this will only improve SA as an attractive destination.

“SA is very attractive because it has a strong domestic market. We believe in domestic business. We've been leaders in domestic business in whichever countries we've invested in.”

He notes that SA would also become an increasingly attractive destination as it is in a position to offer efficiency at a lower cost. This makes it a particularly good acquisition during the global economic crisis, he says.

“What customers are looking at is how we can get our processes to work at a cheaper price without sacrificing quality. In the process, we believe we can create a lot of jobs because there is no industry which can create as many jobs as the BPO industry, directly and indirectly.”