3i takes minority stake in Luxembourg back office business

3i has invested €37 million ($50.2 million) in Luxembourg business outsourcing company, KNEIP, marking a prolific 6 month period with €250 million invested in the region.

3i has taken a minority stake worth €37 million in KNEIP the Luxembourg business process outsourcing company.

Bruce Keith, director of 3i Growth Capital, said: “You can expect another deal from 3i in this space in the next month.” He added that a possible exit would be a sale to a trade buyer.

Akshaya Bhargava, 3i’s industrialist-in-residence since March 2006, will join the KNEIP management as a non-executive director. Bhargava worked for Citigroup for 22 years before starting up business process outsourcing company, Progeon, which became Infosys BPO.

The investment is part of 3i’s strategy for growth capital which takes minority stakes of between €10 million and €150 million in European and North American companies.

The Benelux region has in the last 6 months received €250 million from 3i growth capital investment.

3i intends to expand KNEIP’s services and geographical reach. Its record in business processing services includes Williams Lea and Boundcopy. 3i was also an initial investor in Capita.

KNEIP is an outsourcing partner to the financial services sector that takes on back- office activities for the fund industry.