Churn among senior management hits LPO pioneer Integreon

MUMBAI: Integreon, one of pioneers of the legal process outsourcing industry, is facing turbulence with continuing churn among senior management. Lokendra Tomar, global COO and the number two executive in the firm after CEO Robert Gogel, is learnt to be leaving the company after a disagreement with the top brass.

Among the first to offer legal process outsourcing services from India, Integreon is promoted by the Philippines-based Ayala and private equity firm Actis.

Tomar has been with Integreon for about seven years and was instrumental in growing its global operations as well as playing a key role in several acquisitions Integreon made between 2006 and 2009, including that of Grail Research, the captive research arm of Monitor Group, founded by Michael Porter.

Both the company and Tomar were tight-lipped about the nature of the disagreement, leading to the exit. “As a matter of policy and in respect to the privacy of individuals, Integreon does not comment publicly on reasons related to individual departures,” said Robert Gogel, the current CEO, who joined the company in 2011.

Both, Fred Ayala, CEO of LiveIt Solutions, Ayala Corp’s holding company for investments in the BPO sector and chairman on the Integreon board, and JM Trivedi, head of Actis’ South Asia business and a director in Integreon, refused to comment on the differences with the former CEO or Tomar’s imminent exit.

Tomar confirmed he was ‘moving on’ from Integreon, but did not elaborate on the reasons. ET’s enquiries revealed tensions have been simmering for some time in Integreon, starting with a falling out between the investoRs and the management, led by former CEO Liam Brown in 2011.

In 2011, Brown, who was the founder and largest individual stakeholder in Integreon, fell out with the investoRs over differences on the company’s growth strategy and by his own admission, was fired. “Their (investoRs ) preference was to reduce costs and focus on increasing profitability. Mine was to invest part of the profits in subject matter experts and more management bandwidth,” Brown told ET. The ‘professional disagreement’ ended in a settlement, as part of which he sold all his shares in the company.

Since Brown left, nearly a dozen senior management executives have quit Integreon and about half a dozen have joined Brown’s new venture, Elevate Services, which competes with Integreon in legal process outsourcing (LPO) services. They include the former CFO Richard Little, India delivery head Anurag Grover, HR vice-president Joyce Thorne, marketing director Ron Dappen, India learning and development head Samit Mhatre and VP business development Mark Redmayne.

“We continue to post solid revenue performance, significantly improved profitability and high customer satisfaction, all of which we are very pleased about and augur well for 2013,” said Ayala, when asked about senior management exits. Actis’ Trivedi echoed similar sentiments.

Actis invested in Integreon in 2010, paying about $50 million for a 30% stake. At that time, the company disclosed an annual revenue run rate of around $90 million. Chief executive Gogel said that departure of senior executives is not ‘unusual in our industry’. “Integreon is not single pers on dependent and the departures have not had any impact or current or future growth,” said Gogel, who declined to share revenue details.

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