Firstsource Solutions, part of the Rs 90,000 crore RP-Sanjiv Goenka Group, saw its shares rise 3% in the early session on September 24. The company announced the acquisition of UK-based Ascensos, a customer experience outsourcing partner for retail and eCommerce enterprises, for £42 million, which included an upfront payment and earnouts. At 9.15 a.m., shares of Firstsource Solutions were trading at Rs 324.8 on the NSE, up three percent from the previous session's closing.
Ascensos will operate as a separate business unit within Firstsource, retaining its current brand and Scottish offices while leveraging the merged company's technological strengths and professional people to better serve the retail industry. According to a press release issued on September 23, John Devlin will continue to serve as CEO, providing continuity for Ascensos clients. Sanjiv Goenka, Chairman of RPSG Group and Firstsource, commented on the agreement, saying, "The Retail and CPG BPO business is a $28 billion business globally.
Ascensos offers up a plethora of new growth potential for us, which are supported by our strategy of providing differentiated services based on deep market knowledge and bespoke technology. This relationship will benefit our existing clients while also allowing us to explore new opportunities in the thriving retail sector.
"At first, we anticipated that the acquisition would reduce margin. With projected revenue and operational synergies, Firstsource Solutions's margin profile should gradually improve," according to domestic brokerage Emkay Global. Keeping a target price of Rs 330 per share, the brokerage maintained its 'add' rating.
