Düsseldorf A major merger is taking place in the call center industry: Bertelsmann Majorel holding company wants to merge with twice its competitor Sitel from France, both companies announced on Monday.
The combined company would have sales of EUR 5.4 billion, more than 240,000 employees and 1,000 customers. Majorel currently employs 75,000 people and has recently achieved sales of 1.8 billion euros with its 400 customers.
Both companies manage the relationship between the companies and their end customers. These can be classic call center functions, but also means to acquire customers or moderate discussions on social platforms.
The size of the global market for the so-called customer relationship management (CRM) business is estimated at over 300 billion euros. Most companies do most of the work themselves, according to industry experts, around a third of the market is outsourced.
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The recent merger has further consolidated a highly fragmented industry. So far, the ten largest call center operators have not even achieved a 30% market share. Sitel acquired the US supplier Sykes Enterprises last summer. The industry leader is the French Teleperformance group with sales of EUR 7.1 billion and 420,000 employees. The combined company is coming to this.
Bertelsmann wants to further reduce its stake in Majorel
The largest German media group, Bertelsmann, is withdrawing from the call center business. The family business based in Gütersloh now owns almost 40 percent of Majorel. The group now wants to dilute its stake to an initial 17.3% and is also withdrawing money from Majorela.
Majorel was founded in 2018. The name of the company is a combination of the two words Major and Związek. During this time, Bertelsmann merged the call centers of its subsidiary Arvato with the customer service centers in Morocco, Saham.
The step was a surprise as CEO Thomas Rabe actually wanted to sell the CRM business but found no one interested in its asking price. In a joint venture with Saham, Bertelsmann still owned 50 percent of Majorel. In the fall of 2021, Bertelsmann further reduced its stake by listing the family-owned company Majorel on the Amsterdam stock exchange Euronext.
Rabe has recently announced several times that it primarily wants to invest in high-margin businesses. But the call center industry is under tremendous cost pressure as it is a labor-intensive industry and margins are dwindling. Majorel recently closed several German locations. While more and more call center interactions will be handled through automated technology in the future, this requires a large investment. They can be better managed by large companies.
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This is one of the reasons the news was well received on the stock exchange: Majorel shares rose by more than twelve percent to almost 29 euros, but were still below the 33 euros issue price. Majorel is to be merged with Sitel. However, the combined company is to remain listed on the Amsterdam Stock Exchange. The current boss of Majorel, Thomas Mackenbrock, will be, inter alia, European head of the combined company. Laurent Uberti, former Sitela boss, will be CEO.
Uberti told analysts on Monday, “Thanks to Majorel, we found the perfect partner to accelerate our strategy.” It is about building a global player “and perhaps one day a world market leader.” Both companies focused on different countries, which makes them complementary to each other. The new company has 300 locations around the world and reaches customers in over 70 languages.
Sitel is part of the French billionaire family Mulliez, which has grown rich thanks to companies such as the supermarket chain Auchan and sports retailer Decathlon. With 45 percent is also expected to become the largest shareholder of the combined call center operator. Together with Sitel’s leadership, the billionaires family would then have 56 percent of the stake, previous Majorel shareholders had 44 percent. The merger is expected to be completed by the end of 2022 or the beginning of 2023.
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