Lankan JKH buys 44% in Quatrro arm

Stake sale comes after its acquisition of Chicago firm.

Sri Lanka's John Keells Holdings (JKH) has acquired a 44 per cent equity stake in Quatrro Finance & Accounting Solutions for around Rs 23 crore ($5.7 million). Quatrro Finance & Accounting Solutions is a business unit of the Delhi-based Quatrro group founded by Raman Roy.

The investment made by JKH is a part of the acquisition that Quatrro announced today. The company acquired the captive accounts unit of Chicago-based RSM McGladery's Financial Process Outsourcing (FPO).

The acquisition has been made with JKH in a structured financial transaction using a combination of instruments including debt and equity.

FPO has around 500 people between its offices in Mumbai and the US. Quatrro Chairman and Managing Director Raman Roy said, "I see this move as an integral part of growing Quatrro's business targeted at the SME segment. This will play a catalytic role in building strategically important businesses in undeserved and uncontested market spaces." While the deal size was not disclosed, revenues of this captive unit were around Rs 72 crore ($18 million).

Following the acquisition, RSM McGladery FPO proposes to take advantage of Quatrro's offshore processing expertise to expand its customer base.

RSM McGladery FPO CEO Cesar Soriano said: "We are delighted to be a part of Quatrro, given their track record. FPO's strengths complement those of Quatrro and I believe FPO's platform will make Quatrro an even stronger force in the industry."

This acquisition will provide Quatrro access to over 2,000 customers of McGladery. Quatrro will add two new US fulfilment locations in Madison and Pleasant Prairie and one location in Mumbai to its existing centres in India, China, North America and Sri Lanka.

In 2006, JKH and Quatrro had announced a partnership to develop a business process outsourcing (BPO) business in the Asian region, initially focusing on India and Sri Lanka.