Following the lead taken by rival Serco in March (see Serco acquires UK contact centre provider), Capita has acquired Bristol-based call centre partner Call Centre Technology Ltd (CCT) for £15m on a cash free, debt free basis. As we pointed out in Capita: slow but improving picture, this drive by the UK BPO market leader for further M&A is very much on the cards, and crucial for it to drive growth in FY11.
The target CCT employs 130 people and provides voice telephony, applications and services for customer contact centres, with clients such as 118 The Number, Strathclyde Police and Travelport. But it also provides services to a number of Capita’s existing contracts, and businesses that it has recently acquired such as First Assist and Capita Secure Information Systems (formerly Sungard Public Sector – see here). As ever Capita is getting a good deal, paying a 20% discount on CCT’s most recent FY revenue of £18.7m in the year ended 30 June 2010. CCT also made an operating profit of £1.7m. According to CE Paul Pindar Capita’s “core outsourcing contracts are increasingly encompassing the customer contact interface” so it needs to scale up this side of its business. This fact is nothing new to us. But it does go to show just how Capita can use its significant muscle to gain a larger share of spend from its existing customers.