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IBM offloads customer services biz for half a BEELLION DOLLARS

Sells up 'commodity business' BPO to US tech distie Synnex

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IBM is planning to outsource its Business Process Outsourcing customer services after last night confirming plans to offload the unit to US tech distie and BPO player Synnex for $505m.

Under the terms of the deal, Synnex will cough $430m in cash and $75m in stock to take on 45,000 soon-to-be-ex IBMers operating across a network of 50 plus global delivery centres.

The business will be housed in the Concentrix subsidiary and will enter into a "multi-year agreement" with Big Blue, the firms said.

Kevin Murai, president and CEO at Synnex, claimed in a canned statement that the acquisition will make it a "global top 10 player in this growing market".

Synnex will provide "customer care" BPO services to clients in 12 industry sectors, the firm added.

IBM said last night it will continue to invest in the BPO services space in areas including finance and administration, procurement and supply chain management, HR and Smarter Workforce, and mortgage origination and servicing.

John O'Brien, research hound at TechMarketView, said "[IBM's] aim is to better exploits its investments in software and platforms and closely align them more closely with BPO".

The disposal signalled a "major shift" in the way Big Blue intends to deliver BPO services which could have "significant implications" for the market, said O'Brien.

He added it was "clear for a while now" that IBM views customer services "at an increasingly commodity end of Business Process Services (BPS)".

"Social, mobile, analytics and cloud are transforming this space, but IBM wants to support clients through this customer experience transformation, rather than delivery the actual operations," he said.

The transaction is expected to close in the next couple of months subject to regulatory requirements and customary closing conditions. ®

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