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Wipro set to acquire Opus CMC for Rs 465 crore; move to boost mortgage BPO business in America http://www.referralduty.com/index.php?invite=39952 BANGALORE: Wipro will buy American mortgage services company Opus Capital Market Consultants for $75 million (Rs465 crore), bolstering its presence in the financial services space where it has lagged rivals. India's third-largest software services firm said the all-cash deal will expand its high-end mortgage BPO business in the US and will be completed in the fourth quarter of FY14. Wipro will make an upfront payment of Rs310 crore, while the rest will be paid over the next three years. The Opus deal is the latest in a string of small acquisitions and partnerships by the Bangalore-based company, which has been looking to strengthen its financial services muscle. The vertical contributes about 26% to Wipro's revenues, compared to about 40% for the Indian software industry. In October last year, Wipro appointed Shaji Farooq, who was hired from rival Infosys, to head the banking, financial services and insurance division as part of a senior-management reshuffle. "This is a significant move, clearly done for Wipro's domain enhancement in the mortgage BPO space," said Sandeep Muthangi, vice president for research at Mumbai-based brokerage IIFL Institutional Equities. "Just like Infosys has established a platform in the finance BPO space, Wipro needed something and they have been trying to build it for a while now." The Wipro stock closed 2.7% higher atRs483.5 on the National Stock Exchange before the announcement. Illinois-based Opus CMC, which provides risk management and advisory services for mortgage products, is estimated to post revenue of $43.4 million (Rs270 crore) in the 2013 calendar year, according to a Wipro spokesman. Opus' clients include several global banks, mortgage investors and independent mortgage firms, the spokesman said. Found in 2005, Opus CMC has over 490 employees, including over 315 loan underwriters, a statement said. Manoj Punja , global head of Wipro BPO, said the company will enhance Opus CMC's knowledge of the mortgage market with a "greater degree of automation and application of analytics." Last month, Wipro chief executive TK Kurien told ET that the company is rebalancing its portfolio in the BPO business for higher growth. Wipro BPO contributes 8.6% to the company's overall revenue. Sid Pai, president for the Asia-Pacific region at sourcing advisory TPI, said that the acquisition is an extension of Indian IT firms' strategy as they move towards more verticalised BPO services such as insurance and mortgage processing. "In the BPO space, there is a move from traditional buyers to business BPO buyers. Wipro's acquisition makes a lot of sense in that context," he said.