Wipro Ltd., one of India’s leading IT giants, is slated to acquire the US-based Opus Capital Markets Consultants. The all-cash deal is of the tune of $75 millions (Rs 467 crore) and includes a deferred earn-out component spread over the next few years.
Boost to Wipro’s mortgage solution and outsourcing business
This move will boost Wipro’s hold on the mortgage solutions and outsourcing business. It will strengthen the IT giant’s position as a key player in the arena of mortgage origination, servicing and secondary market.
According to Manoj Punja, the senior vice-president and head of business process outsourcing, “The acquisition will facilitate Wipro’s expansion in the high-end mortgage BPO segment and bring differentiated capability with a platform-based risk management offering.”
The IT firm plans to leverage its offerings with Opus CMC’s capabilities and knowledge base to generate a holistic offering for all mortgage players. It plans to bring more automation and application of analytics in the area.
What is Opus CMC?
Opus CMC was founded in the year 2005. Headquartered in Lincolnshire, Illinois, US, the company offers risk management solutions to the mortgage industry in US. The company has an employee base of 490 members that includes 315 loan underwriters working from five different cities in the US.
Opus CMC provides loan level and operational conscientiousness, support for valuation, forensic analysis and advisory services on every category of mortgage products, residential or commercial. The company offers all services ranging from rewriting whole loans to collateral reviews of securitized pools. Among the customer portfolio of the company are several global banks, mortgage investors, mortgage conduits and independent mortgage originators.
Opus has a projection of $43.4 million revenue earning for 2013
Opus CMC is expected to close 2013 with a revenue of $43.4 million. The acquirement by Wipro is dependent on customary closing conditions and regulatory approvals. The deal is expected to be completed in the fourth quarter of the fiscal year 2014.
Portico Capital Securities LLC acted as the exclusive financial advisor to Opus CMC on this deal.
As per Joseph Andrea and Jennifer LaBud, co-founders and principals, Opus CMC, “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.”
Acquisition in sync with Wipro’s ‘String of Pearls strategy’
Wipro has been acquiring stakes in US-based companies since the start of this fiscal year. In May 2013, the company had acquired a marginal stake in Opera Solutions LLC, a US-based global big data and analytics company, for $30 million (Rs 162 crore).
In June the IT giant had acquired an undisclosed minority stakes in Axeda Corp, another Massachusetts-based company, for $5 million. With such acquisition deals being struck with US-based companies, Wipro is sure marching ahead towards the pinnacle of technology and outsourcing industry.