Manpower Inc. (MAN), one of the leading employment services provider, recently announced that it has gained 74% stake in Kolkata, India-based, Web Development Company Limited (WDC), which offers IT services and professional resourcing.
Following the acquisition, WDC will now be controlled by the ManpowerGroup and will witness rejig in its board.
WDC offer’s services to large number of clients across the Asia Pacific region and have five delivery locations in India, thus enabling Manpower to gain substantial market in this region.
The move was also in line with Manpower’s approach of acquiring companies that reinforce the company’s capability to bring pioneering workforce solutions to its customers throughout the world.
Earlier in a similar move, the company formed a coalition with Microsoft Corporation (MSFT) to promote youth employment and create opportunities for the next generation leaders across the globe.
Additionally, Manpower and Microsoft have teamed up with new partners to build up a new program for next generation leaders involving technological inventiveness coupled with business expansion expertise. The duo will also chip in together to educate, guide and provide professional supervision while developing innovative programs for youth across the globe.
Founded in 1948 and headquartered in Milwaukee, Wisconsin, Manpower is the global leader in employment services industry and commands a well-established network of nearly 4,000 offices in 82 countries.
Manpower’s comprehensive range of services makes the company a true global staffing firm. The company provides services for the entire employment and business cycle including permanent, temporary and contract recruitment, employee assessment and selection, training, outplacement, outsourcing and consulting.
Further, the company’s brand value and strong global network provides a competitive advantage to the company and reinforces its dominant position in the market. Moreover, Manpower benefits from growth prospects in the under penetrated staffing markets of Italy, Germanyand the Nordic region, and has significant operations in high-growth emerging markets of India, Chinaand Eastern Europe. Consequently, the company has a strong upside potential
The employment services industry is highly competitive with limited barriers to entry, and Manpower faces stiff competition in both domestic and international markets from other established players, such as Randstad (RAND.AS) and Kelly Services Inc. (KELYA). However, an intense competition may limit the company’s market share and profitability.
Currently, we prefer to maintain a long-term ‘Neutral’ recommendation on the stock. Moreover, Manpower holds a Zacks #4 Rank, which translates into a short-term ‘Sell’ rating.
