A leading Indian pure-play business process outsourcing (BPO) firm, FirstSource Solutions [Get Quote], has emerged as the frontrunner in the quest to buy the US-based healthcare player MedAssist.

The deal size, sources say, is close to $300 million (around Rs 1,200 crore). If it materialised, it would be one of the largest overseas acquisitions after Wipro's [Get Quote] buyout of Infocrossing for around $600 million and the largest in the BPO space, they added. 

A FirstSource executive, however, said: "As a policy, we do not comment on market speculation."

Sources close to the deal say there is one more serious contender in the race for MedAssist, which has revenues of $90-100 million and provides patient services, eligibility services, patient financing and healthcare collections. It has around 1,400 employees and 950 healthcare providers as clients.

FirstSource is also rumoured to be in the race to acquire Citi's BPO unit after the first round of bidding. The sale of the BPO business, being run by Citigroup Global Services (formerly eServe), is expected to fetch Citi around Rs 3,200 crore.

Other bidders include WNS and Genpact. Around 13 per cent of FirstSource's revenue comes from the healthcare segment. In January this year, it acquired BPM � a Delaware-based healthcare claims outsourcing company � for around $30 million.

Ananda Mukerji, managing director & CEO, FirstSource, had then said: "The healthcare vertical is one of our three focus verticals and represents a high-growth area. We also acquire marquee customers, which provide a good opportunity to cross-sell."

During its initial public offering (IPO) in January, the FirstSource management had indicated that the company intended to use the net proceeds of the issue for acquisitions, setting up facilities, repaying loan and general corporate purposes. Out of the proceeds of the IPO, the company plans to spend approximately Rs 180 crore on acquisitions.

Incidentally, around 37 per cent of FirstSource's revenue comes from the banking, financial services and insurance (BFSI) sector. It maintains, however, that the subprime crisis will not affect it. "While we do have one client offering mortgage services, its exposure is restricted to the UK markets," said a spokesperson.