China’s HNA Group is exploring a sale and other options for its IT outsourcing unit Pactera, Reuters reported.
Pactera reported revenues of $872 million in 2017.
HNA purchased Pactera from Blackstone in 2016 for $675 million in cash. The indebted Chinese conglomerate made $50 billion acquisition spree. Since January, HNA has sold or agreed to sell over $20 billion worth of assets around the world.
Beijing-based Pactera has struggled with its finances. Last year Goldman Sachs suspended early-stage work on its U.S. initial public offering after the deal did not pass the bank’s internal due diligence standards.
HNA has approached several potential investors about an outright sale of Pactera. The group is also considering a spin-off of Pactera’s financial services business for a separate listing.
Ant Financial, an affiliate of Chinese e-commerce firm Alibaba Group and operator of China’s biggest online payment platform, is among investors weighing a deal with Pactera.
The discussions follow unsuccessful efforts by Pactera to secure financing via convertible bonds. Late last year it tapped CLSA, the Hong Kong brokerage owned by CITIC Securities, to arrange a deal worth up to $200 million with an eye also to a future listing in Hong Kong.
Founded in 1995, Pactera offers digital marketing, big data analysis and other services for companies across a wide range of sectors, with offices worldwide. The company works with banks, securities firms and insurance companies. It was recently ranked by IDC Financial among the world’s top 50 fintech businesses.
Pactera in July was downgraded by ratings agency Moody’s to Caa1 from B3, pushing it into junk-rated territory. Moody’s, which said the company’s weak liquidity position was its main concern, also maintained a negative outlook on the ratings.
