In perhaps one of the biggest mergers in the Indian BPO space, two Tata Group companies are all set to integrate their operations.

The Hyderabad-based Tata Business Support Services Ltd (TBSS), a wholly-owned subsidiary of Tata Sons with over 10,000 employees, will merge with e-Nxt Financials Ltd, a 50:50 holding firm between Tata Sons and Tata Capital Ltd, which has over 7,500 staff. The combined entity will emerge among the top three-four companies in the domestic Business Process Outsourcing (BPO) space.

To be headquartered in Hyderabad, the new entity will be led by the MD and CEO of TBSS, Srinivas Koppolu. The MD and CEO of Tata Capital, Praveen P Kadle, is expected to be the Chairman.

The development, which has been in the offing for sometime, gained momentum in the past few weeks. A formal announcement is expected in the next couple of days, while the entire merger process, including going through the necessary regulatory requirements, would be completed by March 31, 2015, according to sources in the know.

This is also one of the first big internal corporate developments within the Tata Group after Cyrus N Mistry took over. He had announced his intention to consolidate the group’s strengths and grow the conglomerate.

The 10-year-old TBSS has operations spread across 19 delivery centres. It has 45-plus global and domestic clients (as of March 2014). It provides outsourced contact centre services to large telecom, Internet service providers, DTH, and online travel agencies. It has 1.2 million connects per day, delivering customer experiences in English (to US and some Indian clients) and 25 Indian languages.

On the other hand, the Mumbai-based e-Nxt with 250 Voice and Data support centres across the country, offers voice-plus field support services to the retail, telecom, automobile, hospitality, manufacturing and banking and financial services industry. The company is strong in extending end-to-end services to domestic and international clients for backend operations. The synergies derived from the integration will give a big boost to both the companies' strengths and employees, sources added.

Tatas’ big push in Telangana

Interestingly, the move also augurs well for the new State of Telangana. It comes close on the heels of the meeting of Tata Group Chairman Cyrus Mistry with the Chief Minister K Chandrasekhara Rao recently. The Tatas’ presence is growing in Hyderabad, with the expansion of Tata Advanced Systems Ltd's manufacturing facility in Adhibatla on the outskirts. TASL, a subsidiary of Tata Sons, makes helicopter cabins in a joint venture with Sikorsky. Recently, it also signed an agreement with Switzerland-based Pilatus Aircraft to manufacture and supply aero structures for the aircraft.

The CEO of TCS N Chandrasekhran also called on the CM this weekend and said the company plans to recruit around 28,000 people in its fast-growing operations out of the State capital.

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