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India's WNS buys UK insurance claims processor

Indian back office services company WNS (Holdings) Ltd, whose key shareholders are British Airways and Warburg Pincus, has bought a UK-based insurance claims management company as part of its diversification strategy, a senior official said on Monday.

WNS has acquired Town & Country Assistance to gain insight into the insurance sector, and plans to use that expertise to become a provider of back office services to insurance companies globally, Neeraj Bhargava, president of WNS, told Reuters.

WNS was wholly owned by British Airways and largely focused on airline clients till May when private equity investor Warburg Pincus picked up a majority stake.

"We wanted to go beyond airlines to financial services and insurance and this is our first major step in that direction," Bhargava said.

He declined to reveal the cost of the acquisition.

The 165-people strong, 13-year-old Town & Country mainly processes motor vehicle insurance claims for more than 20 clients, including commercial fleet operators, brokers and insurers.

"They (Town & Country) wanted to be able to add people very quickly to be able to grow and India was best placed to offer them that option," Bhargava said.

To cut costs, many overseas companies are outsourcing to operators in India back-office services like accounting, claims processing, personnel management and customer support, which are offered remotely through high-speed telecom links.

The attraction is India's huge pool of well-educated, English-speaking youngsters for whom such jobs are a big source of employment.

Following the acquisition by WNS, Town & Country's staff will rise to 500 people soon and all future expansion will be in India, Bhargava said.

GROWTH PLANS

WNS itself has more than 1,700 staff and about 17 clients, including 10 airlines. Five were added in the last quarter.

The United Kingdom is currently a big market for WNS but it is also aggressively courting customers in the United States.

WNS, which runs a 100-seat call centre in Mumbai, will commission a 400-seat call centre in Pune in September to cater to demand from clients for both data and voice services, Bhargava said.

"We can grow organically at 50 per cent a year for the forseeable future," he said.

"We see enough momentum in existing clients to get business and we may also make small to mid-sized acquisitions like this (Town & Country) in the future."

While there was a temporary blip in sentiment in recent weeks due to India-Pakistan tension, customer enquiries now indicate there is no dwindling of India's business process outsourcing business potential, Bhargava said.

"I expect that the largest three to four players will be larger than all but the top eighty to 10 IT services companies in less than two to three years," he said.

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