April 3, 2006

B2B and BPO outsourcing company EDS (Electronic Data Services Inc.) wishes to acquire a majority stake in Indian IT/BPO firm Mphasis. EDS is seeking a 52 percent stake in Mphasis, for which it is willing to pay about $380 million.

EDS already has over 5,000 Indian employees via wholly owned subsidiary EDS India. Mphasis has about 8,400 employees, which places it far below Wipro (41,850), Tata (41,000), Infosys (35,000), and a handful of other big Indian BPO players. Mphasis claims particular traction in the financial services and high-tech verticals.

EDS is one of the vendors involved in GM's big outsourcing project, in which capacity it has already tapped EDS India for service delivery.

EDS hasn't yet officially spelled out its plans for Mphasis within the context of the global "bestshore" model the company says it embraces. As of press time, the EDS website contains a broken link to the press release that was to discuss this planned acquisition.

For what it's worth, someone who claims to be an EDS employee has posted on an online bulletin board that EDS " is about to lay off thousands of support techs and is transferring all their jobs to India."

Source: Line 56