Adecco seals biggest HR deal by acquiring Indian arm

BANGALORE: Staffing and HR company Adecco has completed the acquisition of its Indian arm Adecco India (formerly known as Peopleone Consulting). The Swiss major had earlier bought 67% stake in the Bangalore-based company in September 2004 for $10-15 million (Rs 40-60 crore).

Sources said that the final enterprise value of the acquisition is now $50-60 million (Rs 200-240 crore). The final value makes the deal the biggest in the HR services space in India so far. The other transactions like Vedior buying Mafoi, Randstad buying EmmayHR and Manpower’s deal with ABC Consultants were in the Rs 10-40 crore range.

Peopleone Consulting started operations in 2000 by Ajit Isaac, current CEO of Adecco India with equity investment from JP Morgan Partners and one other financial investor. In 2004, Adecco’s acquisition had included the 20% stake that JP Morgan held in Peopleone, and the rest from promoters and individual investors.

The residual equity stake, which has now been bought by Adecco, was held by the Peopleone management team, led by Ajit Isaac. In fact, 10-12% of the company was in the form of ESOPs, held by about 200 people, sources said.

When contacted, Mr Isaac declined to comment on the stake sale. He, however, said: “Adecco India plans to expand to 52 branches in India from its current 37 by the end of this year and invest in starting more product lines. We are aiming to touch $120-130 million (Rs 480-520 crore) in revenues this year.”

In 2006, Adecco India had revenues of over Rs 300 crore, having seen a compounded growth rate of 600% over the past three years. He also said that Adecco India is close to acquiring an HR company with expertise in blue-collared workers. The deal is likely to be closed in next 45 days.