Mumbai: Rating agency Crisil has acquired a UK-based analytics firm Coalition in a Rs 250 crore deal which will expand the firms global business.
Coalition is in the niche business of providing high end analytics to leading investment banks of the world helping management do a performance analysis of various revenue pools. The company has around 130 employees in US, UK, Singapore and India and was earlier owned by institutional shareholders which included JP Morgan, UBS and Deutsche Bank.
"This is our sixth acquisition in 13 years and inorganic growth has always been an element of our strategy. Today over half of our revenues are coming from overseas" said Roopa Kudva, MD, Crisil. The company which began as a rating agency, today generated half its earnings from research and only 40% is from ratings while the rest is from advisory fees.
Coalition reported 2011 revenues of GBP 8 million. The all-cash transaction has a maximum payout of GBP 29 million (around Rs.250 crores) which is linked to the company's future revenues and profits. In other words, if the targets are not met, the sale consideration would come down.
Ms Kuduva said that Coalition's business fits in with Crisil's research activites and moves them up the value chain. Crisil, which has research centres in India Argentina, Poland and China, will look at expanding Coalition's business in other centres as well. "These analytics can be done in emerging markets as well and provide us with an opportunity to deepen our relationship with existing customers" said Kudva.
"We have worked very hard to find the right partner to take Coalition to the next level of growth, and we are delighted to become a part of CRISIL," said Trevor Foster-Black Chairman, founder and CEO of Coalition. "Crisil is a dynamic and rapidly-growing analytical company with tremendous credibility, a strong business profile and robust balance sheet. I see a very bright future for our business as a member of the Crisil group."
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