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10/8/2009
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Sykes To Acquire ICT Group For $263 Million

Buyout is latest in a series of deals impacting the outsourcing sector.

The wave of consolidation sweeping the tech services market continued as Tampa-based Sykes Enterprises announced a deal to acquire contact center specialist ICT Group for $15.38 per share, or about $263 million in total.

Sykes officials said the deal will leave their company positioned to take advantage of recent market trends in the services sector.

"As clients across the industry move increasingly toward outsourcing more processes to fewer vendors, the breadth and depth of service offerings along with a strong delivery footprint are likely to become a driving force in the industry," said Sykes president and CEO Chuck Sykes, in a statement.

ICT Group, of Newtown, Pa, posted revenues of $428 million in its most recent fiscal year, but has lost money for the past several quarters. Sykes is on pace for sales of $881 million for the current year and is expected to post earnings of $1.35 per share.

Sykes offer of $15.38 per share represents a 46% premium over ICT's closing share price on Oct. 5, one day prior to the deal's announcement.

The deal is just the latest to hit the rapidly consolidating business and IT services market. Imaging giant Xerox last week announced an agreement to buy out Dallas-based Affiliated Computer Services for $6.4 billion. Xerox hopes to marry its document technology with ACS's back office services.

Dell on Sept. 21 disclosed a deal to acquire Perot Systems for $3.9 billion, while Hewlett-Packard snapped up Electronic Data Systems for $13.9 billion last year.

Sykes said its acquisition of ICT remains subject to the approval of ICT shareholders and competition regulators.

InformationWeek has published an in-depth report on Dell's $3.9 billion buy of Perot Systems. Download the report here (registration required).

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