Wipro Ltd, India’s third-largest IT services exporter, has closed its third and largest deal this year by acquiring US-based Opus CMC (Opus Capital Markets Consultants LLC) for $75 million. The transaction includes a deferred earn-out component, as per a statement.
The acquisition will strengthen Wipro’s mortgage solutions and outsourcing business and complement its existing offerings in mortgage origination, servicing and secondary market.
The acquisition is subject to customary closing conditions and regulatory approvals, and will be completed in Q4, FY-2014.
Wipro closed at Rs 481.5, up by 2.24 per cent on Monday when Mumbai market was up 0.51 per cent.
Headquartered in Lincolnshire, Illinois, Opus CMC was founded in 2005. It provides risk management solutions to the mortgage industry in US. The firm employs over 490 people, including 315 loan underwriters across five centres in US.
Portico Capital Securities LLC served as the exclusive financial advisor to Opus CMC on this transaction.
Since the beginning of this year, Wipro has been acquiring stakes in US-based companies. In May 2013, it Wipro had acquired a minority stake in US-based company named Opera Solutions LLC for $30 million.
Then in June, the IT firm had acquired an undisclosed minority stake in Massachusetts-based Axeda Corp for $5 million.
“The acquisition will help us expand in the high-end mortgage BPO segment, and brings differentiated capability with a platform-based risk management offering. Opus CMC has an experienced management team with a deep understanding of the emerging needs of this business,” said Manoj Punja, senior vice-president and head-BPO, Wipro.
Opus CMC offers operational and loan level due diligence, valuation support, forensic analysis and advisory services on all classes of mortgage products, residential and commercial, ranging from re-underwriting whole loans to collateral reviews of securitised pools. Its customer portfolio includes global banks, mortgage conduits, mortgage investors and independent mortgage originators.
“Our industry is at a pivotal point with the introduction of new mortgage regulations driven by the CFPB (consumer financial protection bureau) and government agencies. Wipro and Opus CMC will jointly assist our clients in navigating this challenging and changing business environment and help build reliable outcomes in mortgage origination and secondary market operations,” said Joseph Andrea and Jennifer LaBud, co-founders and principals, Opus CMC.
(Edited by Joby Puthuparampil Johnson)