Greater Pacific Capital acquires 40% stake in HGR

New Delhi, Nov 29 | Updated: Nov 30 2006, 09:35am hrs
Greater Pacific Capital (GPC), a London-based strategic investment firm, has acquired a 40% strategic stake in Hinge Global Resource (HGR), a leading Chinese IT Services and BPO company.

GPC has invested alongside a leading Shanghai-based investing institution and together they own a majority stake in HGR, which also has a leading presence in China with a range of large clients in the banking and payment segments. It is the pioneer in offshore outsourcing and BPO in Japan, from where the company now earns more than 30% of its revenues.

The Chinese IT services and BPO market is estimated at approximately $5 billion in annual revenues and the industry is expected to grow at more than 20% annually over the next five years.

GPC is also exploring strategic joint investments between Indian and Chinese companies, primarily in India's burgeoning real estate and infrastructure sector, pharmaceutical sector, and manufacturing and IT services companies.

GPC is planning an investment of around $500 million in India over the next two years. The firm is also in advanced stage talks for three strategic investments that are likely to be finalised over the next 8-10 weeks, Ketan Patel, founder and CEO Greater Pacific Capital told FE from London. Patel added that a majority of the 3 transactions were major public companies and would be sizable deals in strategic terms as well as the deal value.

We see an immense opportunity in leveraging both India and China's emerging markets and prowess in both pharma and the real estate sector. We are also working towards taking Indian pharma and components companies into China, and getting large Chinese companies in manufacturing and distribution to India, Patel said, adding that the big Chinese companies, particularly in the IT services, media and information services, manufacturing and distribution sectors, and in the financial services domain, had already approached Greater Pacific Capital exploring investment opportunities in India.

It may be recalled that the Chinese government has identified the IT services sector as a key focus for economic development and a core area for collaboration with India.

Leading Indian companies are also looking to penetrate the Chinese market, but still have a relatively small presence in China. Currently, Infosys has only approximately 250 employees in China, Satyam 300 employees and Tata Consultancy Services 250 employees. Patel said that GPC was also looking for opportunities to leverage this potential.