Ayala Corp, Providence Equity acquire eTelecare for $290 M

Conglomerate Ayala Corp. and US-based investment firm Providence Equity Partners Inc. have put together an offer to buy out business process outsourcing (BPO) eTelecare Global Solutions Inc. for $290 million.

eTelecare’s board has unanimously approved the offer, which also includes the acquisition of all outstanding eTelecare American Depositary Shares for $9 cash per share.

The offer price represents a 76 percent premium over eTelecare’s closing price on Nasdaq on Sept. 18. Ayala Corp., through its BPO investment arm LiveIt Solutions Inc. already owns a 22 percent stake in eTelecare, which is based in the Philippines but maintains executive headquarters in North Scottsdale, Arizona.

In order for the deal to be carried out, Ayala Corp. and Providence must get the approval of shareholders owning at least two thirds of eTelecare’s shares and ADRs, as well as regulatory authorities.

In a disclosure to the Philippine Stock Exchange, investment holding company A. Soriano Corp. (Anscor) said it has agreed to be bought out in eTelecare. It owns 1.8 million common shares equivalent to about six percent of eTelecare’s outstanding shares. Upon successful completion of the sale of its shareholdings, Anscor intends to declare a special cash dividend of P0.10 per share.

“Our further investment demonstrates our confidence in the management team and 13,000-plus members of the eTelecare family. Together with our partner Providence, the leading private equity investor in the telecom and media sectors, we will be backing the company as it continues to deliver world class service to its clients,” LiveIt chief executive officer Fred Ayala said.

eTelecare chairman Gary Fernandes, for his part, said the transaction “allows eTelecare’s shareholders to realize significant value from their investment in eTelecare in a timely manner.”

“The company’s acquisition by Ayala Corp. and Providence will also enhance the company’s ability to serve its valued customers. With access to their substantial intellectual and capital resources, the company will be well positioned to expand its role as a leader in the BPO marketplace,” Fernandes said.