The Blackstone connection brought Intelenet enhanced value. And now, the valuation
In 2000, Susir Kumar was a rising star at HDFC. He had already become the youngest general manager and was company secretary heading the ‘risk and collections’ function. Akhil Gupta’s star had already risen in 2000. He was in the inner circle of Mukesh Ambani’s business empire. He was giving shape to Mukesh’s mobile telecom ambitions and was the only Reliance executive to have stayed at the then Mukesh Ambani home, Seawind. Kumar and Gupta’s lives had no reason to intersect.
Call it chance or fate that made these individuals meet, but now their partnership may become a minor case study in how entrepreneurship and hardworking risk capital can create value for employees as well as shareholders. Kumar and Gupta joined hands in 2007 when Gupta’s firm Blackstone backed Kumar and his team’s bid to buy Intelenet, a business process outsourcing (BPO) company from Barclays.
Now, Intelenet has delivered Gupta his first multi-bagger. Blackstone will make three times their invested capital from the sale of the company to Serco. Intelenet gets the backing of the cash-rich Serco to expand. Kumar and a large chunk of Intelenet employees — about 400 — stand to make close to Rs. 470 crore from this transaction. “It is very satisfying. We created 13,000 jobs, expanded Intelenet’s reach from one to seven countries, created significant wealth for top 80 members of its management team and in the process, provided attractive returns to our LPs (Limited Partners),” says Gupta, senior managing director and the chairman of Blackstone India.
What makes this deal special is the symbiotic relationship between Blackstone and Intelenet. Blackstone needed a team which was mature, risk-taking and yet humane. Kumar and his team needed the hard yards that the Blackstone staff offered to make sure that Intelenet became leaner and more efficient. Blackstone created the conditions that helped Intelenet win more business. The intense sales effort has increased Intelenet’s revenue four times over the last four years. And most of the increase has happened in the years that coincide with the credit crisis and worsening business conditions in the western markets.
(This story appears in the 01 July, 2011 issue of Forbes India. To visit our Archives, click here.)