British Airways (BA) has initiated talks with private equity investor Warburg Pincus to divest a majority stake in World Network Services (WNS), the airline's wholly owned, India-based data management subsidiary.
British Airways is, however, planning to retain a "significant stake" in WNS, even though the management control will be divested. The funds raised through the divestment will be used to make investments and "fully exploit the growing third party client base". However, no deadline has been set to complete the negotiations.
WNS, which manages data for the pharmaceuticals, finance, banking and insurance sectors, was set up in 1996 and is currently run by Speedwing, the consulting division of British Airways. The firm, which operates as an independent profit centre, currently has a turnover of pound sterling 11 million, and has 1,400 employees at its Mumbai and Pune offices.
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A British Airways spokesperson declined any relation between the airline's decision to divest its stake in WNS, and the ongoing turmoil in the global aviation industry, which has also affected British Airways' operations.
"The negotiations were initiated much before September 11. British Airways is in talks to divest a majority stake in WNS, in order to concentrate on its core business," the spokesperson said.
British Airways currently operates 18 weekly flights to India, a daily flight each from Mumbai and Delhi, in addition to two weekly flights from Chennai and Kolkata. Warburg Pincus, on the other hand, has invested over $700 million in 17 Indian companies, including the telecom major, Bharti Telecom.