BPO cos in talks to restructure debt, add credit lines to deal with Covid-19 impact

Bengaluru: Call centre companies are taking steps to shore up their financial positions, with Startek’s CEO is forgoing his pay and talking to lenders to restructure its debt and Teleperformance looking for additional credit lines, as they face the deepest impact from the spread of the Covid-19 pandemic.

Voice services have been the hardest to transition to a work-from-home model, as there was little infrastructure available and clients were unwilling to allow private and sensitive data to be accessed outside the protected centres, ET has reported.

At Startek, the US-listed company that bought India’s Aegis, the CEO will forego all cash compensation for the year.

“Aparup Sengupta, Executive Chairman and Global CEO at Startek, who has not received compensation in any form since his appointment on January 15, 2020, will forgo any cash salary for the remainder of 2020,” the company said in a statement. The decision comes in order to mitigate financial impacts to the Company as global markets are impacted from widespread disruption and mandated steps to slow the spread of the novel coronavirus,” the company said.

Startek is also talking to its lenders to restructure its debt. As of December 31, 2019, the company had over $130 million in long-term debt according to its annual filing with the US Securities and Exchange Commission.

Teleperformance, which is listed on the Paris Stock Exchange, is also taking steps to shore up its finances, the company said.

Teleperformance is in the process of securing additional credit lines for above 700 million euros, on the top of undrawn facilities for 500 million euros available right now, to allow the group to cope with crisis contingencies,” Teleperformance said.

The company said that it had managed to move 50% of its employees to a ‘work-from-home’ model, about 120,000 employees, and is targeting achieving 66% work-from-home by mid-April.