Capgemini buys stake in Unilever’s Indian services unit

French IT services company Capgemini is acquiring a 51 percent stake in Unilever India Shared Services, a finance and accounting business process outsourcing (BPO) operation in India belonging to European consumer goods maker Unilever Group. The financial terms of the agreement were not disclosed.

The acquisition of a majority stake by Capgemini in Unilever India Shared Services is the first step towards full acquisition of the company by 2008, said Baru Rao, chief executive officer of Capgemini India on Thursday.

Unilever’s continued investment in Unilever India Shared Services, also called Indigo, until 2008 is an indication of Unilever’s commitment to giving the company business, Rao said. The decision of the consumer goods maker to divest from Indigo is in line with its strategy to pull out of noncore areas, Rao added.

As part of the relationship between the two companies, Capgemini and Unilever have entered into a seven-year agreement to deliver finance and accounting BPO services to Unilever Group companies that are currently serviced by Indigo. The services will be delivered by Indigo’s current staff, as well as staff from Capgemini who will operate out of a single entity, Rao said.

Indigo is a provider of financial shared services and Sarbanes-Oxley Act compliance services to the Unilever Group worldwide. It has operations in Bangalore and Chennai, and has nearly 600 professionals, including about 75 Chartered Accountants, working in these centers. It currently serves Unilever companies in about 45 countries.

The acquisition, which is expected to be completed by October, will help Capgemini increase quickly the number of staff it has working on finance and accounting BPO in India, Rao said. Currently, Capgemini’s Indian operations have about 450 BPO staff of which about 50 are in finance and accounting BPO.

Indigo will be an extension to Capgemini’s current BPO delivery network in Poland, China, India, Australia, the U.S. and Canada, Capgemini said. For Indigo, the tie-up with Capgemini provides an opportunity to address customers outside the Unilever Group.

Although Unilever continues as an investor in Indigo, all future investments in sales, infrastructure and staffing at Indigo will be done by Capgemini, Rao said. Unilever will not make any profit from the operation during the transition to full ownership by Capgemini, he added.

Capgemini said earlier this year that it will make India its hub for offshore delivery of IT and BPO services. The company’s Indian operation, which currently employs about 5,600 staff, will have 10,000 staff in India by the end of next year.