MANILA, Philippines - Ayala Corporation's Business Process Outsourcing (BPO) investment company, LiveIt Investments Ltd., has entered into a definitive agreement to acquire IQ BackOffice, LLC of Los Angeles, California.
In a disclosure to the Philippine Stock Exchange, Ayala said the purchase was done through LiveIt's investee company HRMall, which provides outsourced IT- enabled HR services out of Manila.
IQ BackOffice delivers high quality, software-enabled, real-time, SAS70 Type II-certified finance and accounting BPO services to mid-sized companies in the US. It targets companies with annual revenues of $50 million to $1 billion, but its business includes clients with revenues up to $10 billion.
The combined companies are valued at approximately $15 million. The management team of IQ BackOffice LLC, including David Schnitt, its founder and CEO, will purchase a 17.5 percent ownership interest in HRMall.
LiveIt will own the balance of 82.5 percent of the company and will support the company's strategy to accelerate its growth in its current markets in the U.S. and Asia.
HRMall will now be able to provide a complete suite of low-cost, best-in-class HR, finance and accounting services to the underserved mid-sized enterprise sector in the US and Asia.
This will be through a combination of proven technology, proprietary software and processes, deep domain expertise in multiple industries, and efficient outsourced operations that enable its clients to gain world-class back office capabilities while achieving 30 percent to 50 percent annual cost reduction.
HRMall's clients will now include over 30 US companies in the manufacturing and distribution, restaurant, hotel and hospitality, retail, professional services, property management, financial services and other industry sectors, as well as members of the Ayala group of companies.
The Company will operate as HRMall in Asia and IQ BackOffice in the US, and will employ a total of over 300 employees out of its centers in Manila, Chennai, Mumbai and Los Angeles.
IQ BackOffice's founder and CEO, David Schnitt said: "I believe that HRMall's existing HR services such as payroll are very complementary to the services we provide to our existing clients in the US, and that the Philippines greatly complements our service delivery capabilities from India and the US."
JP Orbeta, Chairman of HRMall, stated that, "The combination with IQ BackOffice will allow us to achieve our vision of offering a full range of highly efficient, market leading back office solutions to medium-sized clients around the world."
Alfredo Ayala, CEO of LiveIt, added that, "This acquisition by HRMall adds a high growth, high margin and very complementary business to HRMall, with numerous cross selling and operating efficiency opportunities, and is expected to create significant value for LiveIt."