Report: Fidelity puts IT unit on the auction block
15 December 2008
Financial services "behemoth" Fidelity Investments is looking to sell a 2,000-employee strong IT unit based in India, according to reports.
The country's Economic Times said the captive technology solutions division is being offered to bidders in an effort to cut costs in the face of the global economic downturn.
Sources connected to two bidders told the publication that the prospective deal involves the unit's employees, as well as its offices in Bangalore and Chennai. The buyer would also receive a multi-year outsourcing contract from Fidelity.
The unit is part of the Fidelity Research and Management Company India, which supports the group's US operations with captive back office operations, the newspaper said.
It added that earlier in the year, deteriorating market conditions prompted other financial services firms, including Citigroup and insurance specialist Aviva, to unload their captive back office divisions.
Fidelity is the largest mutual funds provider in the US, as well as the biggest provider of 401(k) pension plans. The group has an estimated 24 million customers worldwide.