BPO service provider Foundever Group may be in trouble. This is reported by the French trade journal En-Contact after it became clear that the company has received a lower rating from S&P.
Foundever Group SA is an outsourced contact center headquartered in Luxembourg. The company has approximately 170.000 employees and recorded revenue of 4 billion dollars last year. Foundever has been the new name of Sitel since 2023, after Sitel acquired competitor Sykes Enterprises in 2021 for 2,2 billion dollars.
According to En-Contact, provides S&P predicts that Foundever's rating will drop later this year to a default – the situation in which contractual obligations towards lenders can no longer be met.
Although there are cautious signs of stabilization (the decline in revenue leveled off in Q3, there was sequential profit growth and even a slightly positive free cash flow), the company still drew on equity in the third quarter of last year to bear financing costs.
En-Contact also reports that a contract was scheduled to start from the Canadian province of New Brunswick, under which Foundever would take over the provision of virtual healthcare services (eVisitNB). That transfer has been postponed to July 1, following critical questions from a Member of Parliament regarding Foundever's financial position as the new provider.
The owner of Foundever, Groupe Acticall, acts via investment vehicle Creadev was established to guide promising companies to market leadership. During the period of the Sykes acquisition, a total of $2,84 billion in financing was raised. Earlier, during the merger between Sitel and ClientLogic in 2007, the company was already dealing with a debt burden of $800 million and an interest rate of 11 percent, although that debt position was later successfully refinanced in 2018.
As a BPO player, Foundever faces a market that is gradually investing more and more in AI capabilities itself, and where BPO assignments are spread across multiple suppliers. Last year, the transformation towards an AI company already led to a mass layoffs at Foundever. At the same time, the company announced it intended to grow strongly in, among others Egypt.
Foundever is also active in the Benelux, including at locations in the Netherlands.
(Ziptone/En-Contact)
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