As one might have guessed two years ago when HP acquired EDS, HP doesn't want to stay in the benefits outsourcing space. In June of last year (hindsight: in preparation for its merger with Watson Wyatt) Towers Perrin sold its minority stake in excellerateHRO to HP, which presumably was just looking for 100% ownership in order to be able to sell the division. That sale took place today, as ACS attempts to grow its presence in that market.
http://realbusinessatxerox.blogs.xerox.com/2010/05/25/966/
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3 comments:
don't understand it
I thought I read that the ExcellerateHRO was sold for 125 million, I thought that sounded pretty low, how much value was lost between the time that Towers sold it off and HP sold it off.
I think the idea of the merger is to force some synergies out of this ExcellerateHRO Buck combo and wonder how much if any input Buck had in the acquisition.
If it was up to Buck would there ever have been an acquisition? Especially considering that Towers, a large player in the actuarial pension consulting sold off the unit years ago? Is Xerox under the impression that they will be able to unlock some growth potential with in this market and that Towers just wasn't able to figure out how to do it?
Maybe Xerox believes they will be able to lure current ExcellerateHRO clients over to Buck and provide end to end hr benefit services and how is this any different from what Towers tried, in a better economy none the less.
Buck may be better off on its own at this point if that's possible.
Buck is probably better off as an independent entity at this point.
However, there is some merit to the idea of growing ACS's benefit outsourcing business through acquisition of eHRO's client base. It's not going to get as big as Hewitt or Fidelity trying to grow organically.
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