Aviva's captive on sale
After postponing the transfer of its build-operate-transfer (BOT) contracts with its three vendors a couple of times, Aviva Plc has finally decided to put its captive for sale to all interested bidders.
By N Shivapriya, TNN |
MUMBAI: After postponing the transfer of its build-operate-transfer (BOT) contracts with its three vendors a couple of times, Aviva Plc has finally decided to put its captive for sale to all interested bidders. The insurance major has also appointed an investment banker to take the process forward, signalling the seriousness of its intent.
After the sale of Citigroup���s captive fell through, this is the second major financial services captive that is up for sale. The bids were initially open only to its three vendors, WNS Global Services, EXL Services and 24/7 Customer, said a source. By opening the bid to more players, the insurance major will be able to get a better price for the facility than if it had been restricted only to three players.
Aviva was learnt to have been exploring various options, including a sale of its facilities at Chennai, Pune and Noida to the respective vendors servicing them, before deciding on this course of action. ���We have been doing a strategic review of our offshoring business but have made no decisions at this stage. The review has identified a number of viable alternatives to a captive model and we are exploring those,��� an Aviva spokesperson said.
���All the leading BPO players including those with integrated IT and BPO plays such as Infosys Technologies and Wipro would be interested in Aviva���s operations,��� said an investment banker who did not want to be named. The valuation of the captive would depend on the amount of business Aviva is willing to commit to the buyer and for what duration, he said.
In all likelihood, the sale process will be as complex as the Citigroup captive, or perhaps even more. An executive close to the development attributed the complexity to one of the reasons why Aviva was taking so long for it. Aviva���s operations are split between the three vendors and itself. It had earlier exercised the transfer option for two of its facilities���a 1,600-person operation in Bangalore from 24/7 Customer and a 350-person operation from WNS in Colombo, Sri Lanka.
After the sale of Citigroup���s captive fell through, this is the second major financial services captive that is up for sale. The bids were initially open only to its three vendors, WNS Global Services, EXL Services and 24/7 Customer, said a source. By opening the bid to more players, the insurance major will be able to get a better price for the facility than if it had been restricted only to three players.
Aviva was learnt to have been exploring various options, including a sale of its facilities at Chennai, Pune and Noida to the respective vendors servicing them, before deciding on this course of action. ���We have been doing a strategic review of our offshoring business but have made no decisions at this stage. The review has identified a number of viable alternatives to a captive model and we are exploring those,��� an Aviva spokesperson said.
���All the leading BPO players including those with integrated IT and BPO plays such as Infosys Technologies and Wipro would be interested in Aviva���s operations,��� said an investment banker who did not want to be named. The valuation of the captive would depend on the amount of business Aviva is willing to commit to the buyer and for what duration, he said.
In all likelihood, the sale process will be as complex as the Citigroup captive, or perhaps even more. An executive close to the development attributed the complexity to one of the reasons why Aviva was taking so long for it. Aviva���s operations are split between the three vendors and itself. It had earlier exercised the transfer option for two of its facilities���a 1,600-person operation in Bangalore from 24/7 Customer and a 350-person operation from WNS in Colombo, Sri Lanka.
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