Essar sells Aegis to Capital Square Partners

AGC Holdings Limited (AGC) Mauritius, a wholly-owned portfolio company of Essar Global, has signed a definitive agreement to sell its 100 per cent stake in ESM Holdings Ltd, Mauritius, to Capital Square Partners (CSP), for an undisclosed sum.

However, according to a Press Trust of India report, the deal is valued at around $275-300 million.

''This transaction is in line with our strategy of incubating, building and operating world-class businesses, and being open to monetising them at a premium value when the market conditions are favourable,'' said Uday  Gujadhur, director-AGC.

ESM Holdings is the holding company of Aegis, a global outsourcing company. Essar will use the net proceeds of this sale to retire its debt, the company said in a statement.

This marks Essar Global's complete exit from the BPO business "after creating significant value through organic growth and strategic acquisitions that helped diversify customer offerings," the company said in a statement.

The transaction is expected to close during the first quarter of FY 2017-18, subject to receiving regulatory approvals and other customary closing conditions.

"Aegis has established itself as a high-value service provider to its customers. We shall continue to provide quality service to our esteemed customers and be an employer of choice. I am confident that the added capabilities of our new shareholder will present an even more compelling value proposition to the marketplace,'' said Sandip Sen, managing director, Aegis.

Essar entered the BPO business in 2004 with the acquisition of the US-based Aegis Communications Group, with 2,000 employees.

In 2014, AGC sold Aegis USA Inc (comprising Aegis' operations in the USA, the Philippines and Costa Rica) to Teleperformance. As a result of the sale, the Aegis headcount and revenues were substantially reduced.

Since then, Aegis has once again grown the business substantially in terms of headcount, revenues, product offerings and customer base becoming a preferred vendor for many premium clients in key industries, such as telecommunications, technology, media, banking, financial services & insurance, travel & logistics, retail and eCommerce.

Currently, Aegis has revenues of around $400 million, and employs more than 40,000 people across 47 centres in 10 countries with operations in India, the UAE, Sri Lanka, Malaysia, Australia, South Africa, Peru, Argentina, Saudi Arabia and the UK.

Essar's advisers in the transaction include Axis Capital as financial advisor, and Platinum Partners and Sidley Austin as legal advisors. Shearman & Sterling and Shardul Amarchand Mangaldas acted as legal advisors to CSP.