TDCX founder proposes taking BPO private

SINGAPORE, SINGAPORE — Business process outsourcing (BPO) provider TDCX recently received a non-binding proposal from its founder and CEO Laurent Junique to take the company private, just over two years after its initial public offering.
Junique, who currently owns an 86.1% stake in TDCX, offered $6.60 per share to acquire the remaining shares, representing a 36% premium to the latest closing price but below the IPO price.
In a letter to the board, Junique called the proposal an “attractive opportunity” for shareholders.
The offer comes amidst a struggling stock price for TDCX. Analysts have set a $8.10 per share fair value target, 23% above Junique’s proposed buyout price. Revenue also declined 5.4% year-over-year last quarter, though Junique described the overall business as “strong and resilient” during the recent earnings call.
TDCX already formed a special committee of independent directors to evaluate the privatization proposal with the assistance of financial and legal advisors. There is no certainty that Junique will make a definitive offer or that a final agreement can be reached.
As a private entity, TDCX would shed burdensome public company regulations and disclosure requirements. The deal could allow management to focus on long-term goals rather than short-term quarterly targets. Junique may also find running the BPO provider more lucrative without public shareholders.
Tech in Asia Chief Analyst Simon Huang believes TDCX’s privatization plan is a unique case in Southeast Asia, given its small size and concentrated insider ownership. Huang said that larger regional peers are unlikely to pursue similar buyout deals and privatization in the near future.
TDCX landed the 31st spot in the 2023 Time Doctor OA500, an objective index of the world’s top 500 outsourcing companies. The 2024 edition of the OA500 will be released next month.