KKR In Talks for Control of FirstSource

MUMBAI (Reuters) – U.S. private-equity firm Kohlberg Kravis Roberts & Co is in talks to buy a controlling stake in Indian back-office service provider Firstsource Solutions (FISO.BO), three sources with direct knowledge of the matter said. KKR is negotiating to buy a stake totalling about 68 percent of the IT services company from No. 2 Indian lender ICICI Bank (ICBK.BO), Singapore state investor Temasek Holdings and U.S.-based banking technology group Metavante, the sources said.

A deal has not been finalised, but a sale price could be about $250 million, said two of the sources. None of the sources wished to be named as they were not authorised to speak to the media.

Firstsource has a market value of $300 million.

The three sources characterised KKR as the frontrunner for Firstsource. Another source familiar with the matter said KKR was in talks for Firstsource but did not agree that the buyout firm is the frontrunner and declined to elaborate.

Rival U.S. private-equity firm Carlyle Group [CYL.UL] was also eyeing the stake, but was not a strong contender in the process, two of the sources said.

Carlyle declined to comment.

It could not be determined whether there were other bidders pursuing Firstsource.

“ICICI Bank has stated consistently that its investment in Firstsource is a financial investment and the bank would look at reducing its holding over a period of time. The bank evaluates all opportunities on an ongoing basis,” ICICI said in a statement e-mailed to Reuters.

Firstsource and KKR declined to comment.

Temasek declined to comment and Metavante could not be reached for comment.

(Reporting by Pratish Narayanan and Indulal P.M.; Additional reporting by Saeed Azhar; Editing by Tony Munroe)