In the customer service outsourcing industry there are 2 ways to grow.
Either you grow organically from within, or you aquire a competitor
with synergies. StarTek is turning the company around by recognizing
the need to offshore much of its call centers to areas where multi-lingual
low cost labor is abundant. Margin improvement in StarTek' business
has been coming from overseas operations in the Philippines, and
Central America. StarTek has also diversified its customer mix, so
it is not as concentrated with its top 2 customers.
With a stake in SRT you get an undervalued company that is
also an arbitrage on acquistition. StarTek is based in Colorado but
plays in the backyard of much larger competitors. Teletech, and
Syke, are both aggressively competing for share.
Earlier in 2012, SYKE purchased Denver based Alpine at a large
premium. There is no doubt larger competitors like Convergys,
Teletech, and Syke, are keeping an eye on StarTek.