Affiliated Computer Services (ACS) handles jobs its clients would rather hand off. The company provides business process outsourcing (BPO) services for commercial enterprises and government agencies, focusing on markets such as communications, health care, and transportation. As an outsourcer, ACS handles functions such as administration, including health care claims processing; finance and accounting; human resources; payment processing; sales, marketing, and customer care call centers; and supply chain management. BPO services account for most of the company's sales. ACS also offers information technology and systems integration services. In early 2010, ACS was acquired by printing equipment giant Xerox.
The ACS/Xerox combination created a document management services/BPO powerhouse. The acquisition, valued at $6.4 billion, is expected to triple the amount of revenue Xerox receives from its services segment, from $3.5 billion in 2008 to around $10 billion in 2010. Despite being acquired, ACS still operates as an independent organization and is being branded as ACS, a Xerox Company. By taking advantage of Xerox's worldwide brand presence, ACS hopes to extend its products and services reach to markets on a more global scale. Lynn Blodgett, the president and CEO of ACS, is reporting directly to Xerox CEO Ursula Burns. ACS founder and former chairman Darwin Deason owns 5.5% of the newly combined entity. Before the deal was completed, Deason controlled a 44% voting stake in ACS.
Despite being acquired by Xerox, ACS has not slowed down its growth plans. Later in 2010 it acquired ExcellerateHRO (EHRO), a provider of benefits administration and relocation services, from computer giant Hewlett-Packard. ACS made the deal to solidify its position as a leading pension administrator and to broaden its customer base; EHRO serves not only midsized businesses but also Fortune 500 customers.
Several months later, ACS improved its position in an important market through the purchase of TMS Health, a teleservices provider serving the pharmaceutical, biotech, and healthcare industries. ACS projects that pharmaceutical companies spend up to $12 billion each year on marketing, and the deal will enhance its ability to offer industry news and tips, recruit for clinical trials, and provide inbound and outbound sales calls.
In the past, ACS hoped to grow by gaining new clients and by selling new services to existing clients, primarily within its current markets; in addition, it looked to acquisitions as a means for augmenting existing business lines and entering new markets. In 2009 ACS bought e-Services Group International for $85 million. e-Services, an offshore call center and BPO company, added 4,000 employees whose English language proficiency was cited as a factor in the deal. ACS kept its eye fixed on Europe a few months later when it snatched up UK-based Anix for $51 million. Anix specialized in IT consulting, analysis, and design services for the UK market and has operations in Bristol, London, and Manchester.
Along with other BPO companies, ACS has benefited from a cost-conscious mindset at both businesses and government agencies. It draws commercial clients from a wide variety of industries, and its government arm serves federal, state, and local agencies. Handling Medicaid claims for state agencies is a company specialty.
ACS operates from a network of about 315 offices in the US and about 110 offices in more than 25 other countries. US-based clients account for the vast majority of the company's sales.
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