Indian IT services group Tech Mahindra has agreed to buy Target Group, a UK business process outsourcing (BPO) and software provider to financial institutions, for an enterprise value of £112 million.
Currently owned by Pollen Street Capital, Target's technology helps to automate end-to-end processes in the lending, investments and insurance markets and is used by around 50 FS firms, including Goldman Sachs, Morgan Stanley and Yorkshire Building Society.
The firm, which posted revenues of £51 million in 2015, has around 740 employees, led by co-group CEOs Ian Larkin and Bill Alley, who will remain with the business post acquisition, which is slated for Q2 2017, subject to FSA approval.
Tech Mahindra says that the deal boosts its banking, financial services and insurance practice as it seeks to strengthen its fintech hand, providing cross-selling opportunities to acquired clients and technology that can be sold in new markets.
CP Gurnani, MD and CEO, Tech Mahindra, says: "Target Group's strong IP and disruptive proprietary platform significantly enhances our Fintech offerings. This acquisition will make us a formidable player in the UK BFSI market with over 50 major financial institutions as clients. The acquisition lies at the confluence of several of our strategic priorities - add IP, double BFSI revenue and expand European footprint."