Aviva invests $12.5 M in Talwar's EXL

By siliconindia staff writer   |   Tuesday, 07 September 2004, 19:30 IST
Printer Print Email Email
NEW DELHI: The world's fifth-largest insurance group, Aviva has picked up minority stake in one of the leading third party BPO service providers in the country, EXL Services for $12.5 million. While EXL, Vice Chairman and CEO, Vikram Talwar confirmed the investment by Aviva, he refused to divulge details about the percentage of stake or valuation of the company. However, according to sources, EXL has been valued at $250 million, implying a 5 percent stake in the company. According to Voice&Data estimates, the company had reported revenues of $34.17 million in 2003-04, with 43 percent business coming from Aviva. Although it has announced ambitious performance targets of achieving the $100 million-mark during fiscal 2004-05, analysts are more moderate in their rating, pegging EXL in the $50 million mark during this period. Experts also feel that the $250 million valuation of the company is a little on the higher side. EXL, which started as a venture-backed independent company, made it to the national headlines after Consececo acquired it. Later, when Consececo filed for bankruptcy under Chapter 11 in November 2002, many wrote it off because 95 percent of its revenues came from the parent company. However, not only did Talwar and his management team pulled out the company of this crisis, they managed to rope in Oak Hill Capital Partners and FT Ventures to fund ramp up and future growth. The company also ramped up its customer base from two in December 2002 to seven in March 2003 and presently has eight clients-Aviva and Dell being the two major ones. The company has also productized some of its processes and one of them called PROMPT has been licensed to a few clients. While the company raked in around 10 percent of its revenues from such products in 2003-04, it expects to increase this to 15-20 percent level in 2004-05. Interestingly, while the market is abuzz with rumors that the company is planning its Initial Public Offering (IPO) soon, Talwar refused to comment. "Any company like us, will keep on considering various such options, but nothing so far has been decided," is what he had to say. According to him, the money from the deal with Aviva would be used for routine purposes and not for any expansion plans.

siliconindia