Sitel Takes Over Domestic Rival Sykes in $2.2 Billion Deal

BPO provider Sitel Group has agreed to acquire its American peer Sykes for US$2.2 billion.

The merger will turn Sitel into a BPO giant, increasing its global headcount to in excess of 150,000.  The combined company is also expected to make more than $4 billion in annual revenue.

Founded in North Carolina in 1977 as an engineering services business, Sykes has an interesting history. Sometime in 1990, founder John Sykes saw the opportunity to move into the consumer support services arena to offer tech support, which has remained at the center of its offering even to this day.

Sykes has since acquired several smaller rivals, widening its footprints to major across Latin America and Europe. In Latin America, Sykes has delivery centers in Costa Rica, Colombia, Brazil, Mexico, and El Salvador.

Sykes’ LatAm journey began in Costa Rica nearly two decades ago. Today, a large chunk of its regional workforce, (about 6,000 people) is based in Costa Rica.

Sykes and Tech Support

Moreover, Sykes’ tech support service is not as vulnerable to automation as other call center services. In an interview with Nearshore Americas five years ago, its CEO Chuck Sykes said: “The work that we are doing particularly in El Salvador and Colombia and all the Latin American operations is very very technical. Those are not being automated.”

The transaction is expected to be completed in the second half of 2021. And Sykes will be delisted from Nasdaq soon after.

Sitel is not new to Latin America either. It has operations in Nicaragua and Panama, in addition to Mexico, Brazil, and Colombia. The Miami, Florida-based company runs delivery centers in Canada as well, besides dozens of countries in Europe and Asia.

Olivier Camino, Sitel’s co-founder, says the BPO industry has undergone a dramatic change with the rise of the work-at-home model. “Post pandemic, ……….. the need for valuable emotional connections and conversations between brands and their consumers has never been so important,” he added, indirectly disclosing the reason for the acquisition.