Citigroup, Lehman Bros. Sell India Outsourcing Units

[OhioChick]

Source: Information Week

Citibank's $505 million sale to Tata was a year in the making, while other U.S. banks may face difficulties unloading India outsourcing operations.

October 8, 2008 03:25 PM

While the government prepares to bail out some U.S. banks, some banks are bailing out of India-based operations.

Tata Consultancy Services on Wednesday announced it's acquiring Citigroup Global Services for $505 million, a unit of Citi that provides business processing outsourcing -- including customer call centers, document imaging, and IT support -- for Citi's various global entities. The unit employs 12,500 people in Mumbai and Chennai.

The deal comes two days after Nomura Holdings of Japan said it would acquire, for an undisclosed amount, Lehman Brothers' India-based BPO and IT services organizations, which employ 3,000 people in Mumbai, nearly half of them in IT. Lehman, a central figure in the financial market crisis, filed for bankruptcy protection last month.

Citi is among the banks that have fared relatively well in the crisis, and is currently battling it out with Wells Fargo over a purchase of Wachovia Bank. Still, Citi has been trying to unload its India-based BPO operation for at least a year as part of a broader cost-cutting strategy.





Read more: http://www.informationweek.com/news/services/business_process/showArticle.jhtml?articleID=210800517

[Donnachaidh]

1. they got what they wanted - got rid of the jobs that had benefits

And they know if they want to continue on the Washington Welfare System they are going to have to look as if they aren't taking more jobs overseas. Of course, with the recession on they won't be hiring any time soon in this country.