ICT Group to be purchased for $263M

ICT Group Inc., a Newtown-based call-center company, is being purchased by a Florida firm for $263 million in cash and stock.

Sykes Enterprises Inc., of Tampa, which provides customer-management solutions to companies around the world in the communications, financial-services, health-care, technology, and leisure industries, said yesterday that it would pay $15.38 a share, a 46 percent increase over Monday's closing price of $10.55.

ICT Group, which was founded in 1984, provides technical support and database marketing as well as e-mail management, data entry, collections, claims processing, and document management services. It has more than 18,000 sales and service representatives worldwide and 40-plus operations centers throughout North America, Europe, Latin America, Australia, India, and the Philippines.

The merger is expected to bring only minimal client overlap, Sykes said.

Sykes, a publicly held company with a market cap of about $867 million, said it expected to close the deal by the end of the year. Both boards have given their approval; still to be obtained is approval from ICT shareholders.

Sykes said it expected to realize synergies of up to $20 million a year from the merger.

The combined company is expected to generate annual revenues of $1.2 billion, Sykes said. Its revenues last year were $819.19 million; ICT's were $428.18 million.

ICT shares rose yesterday as much as $15.21 but early yesterday afternoon were trading at $15.09, 43.03 percent over Monday's close. Sykes shares were trading at $21.36, up $1.21 (6.01 percent).

"This transaction gives the combined companies the scale and size needed to effectively compete on a global basis," said John J. Brennan, chairman, CEO, and president of ICT. "Upon completion of merger, we will have the resources and footprint to address the increasingly complex needs of our Fortune 500 client base."

The Sykes-ICT acquisition comes amid a wave of consolidation in the IT services sector. In September, Xerox Corp. said it wanted to acquire Dallas-based Affiliated Computer Services Inc. in a deal valued at about $5.5 billion, while Dell Inc. announced its plans to buy Perot Systems Corp., also based in Texas, for about $3.9 billion.

ICT Group Inc., which in August announced a contract worth as much as $24 million over five years to run the federal government's public-information center, in March rejected an $8-a-share offer from Essar Group subsidiary Aegis Ltd. of Mumbai, India.