Global financial services provider, Fidelity Investments, is understood to have zeroed in on IBM and HP to sell its captive unit in India. The financial services firm had ruled out Indian players like Infosys and Wipro, among others, said a source close to the development. The deal could be close to $100 million (over Rs 500 crore), with an assured revenue component or a multi-year outsourcing deal for the buyer.

“The deal should close by the end of March as the due diligence has started. Fidelity has ruled out Indian players as it wants a firm that has presence in at least 40 countries,” said the source.

When contacted, an official spokesperson said: “I cannot comment on names but can confirm we are evaluating sourcing options with leading global technology service providers that will help us maximise the value we offer our customers, shareholders and employees in the long term. We are always looking for opportunities to expand our global footprint.”

The captive — Fidelity Business Services India — was set up in India in 2001 in Gurgaon and expanded to Bangalore in November 2003, and subsequently to Chennai. As part of consolidation, the company had closed its Gurgaon centre last year and asked its employees to relocate to Bangalore and Chennai.

IBM and HP spokespersons said they did not comment on speculation.

Fidelity spokesperson said the sale of the captive was not being done due to cost pressures but as “part of our global business transformation strategy to explore options to optimise our technology delivery model, including that contained in our captive unit in India”.

The technology solutions group, with close to 2,400 people, is part of Fidelity Research & Management Company India, which provides captive back office support to Fidelity in the US.

Source: Business Standard