Fidelity National Financial books passage to India with Covansys
27 April 2004 | 8102 views | 0
Fidelity National Financial has booked its ticket to the offshore outsourcing space by paying $131 million for a 29% stake in IT services outfit Covansys.
Under the deal, Fidelity Information Services will acquire 11 million common shares of Covansys stock, making it the firm's largest shareholder.
Fidelity National has also entered a five-year outsourcing agreement with Covansys, that promises $150 million in revenues from either internal FNF programming and development activities or from external FNF client outsourcing referrals.
Covansys has six development centres in the US and India from which it operates a combined onsite, offsite and offshore delivery model.
William Foley, II, chairman and chief executive officer of FNF, says the deal provides the firm with an opportunity to generate incremental revenues from its financial institution customers base.
"Prior to this investment, FNF's global outsourcing activities consisted of project-based, contractual relationships with several offshore service providers," he says.