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Convergys to buy Stream Global Services

CINCINNATI (AP) -- Convergys Corp. plans to acquire fellow customer service company Stream Global Services Inc. for $820 million in cash to expand its business.

The companies said Monday that the combined company would have annual revenue of more than $3 billion.

Cincinnati-based Convergys said that it expects the deal will add approximately 35 cents per share to its earnings in the first year after its close, excluding one-time charges and other costs. It expects annual savings of $25 million once the integration is complete.

Stream Global, based in Eagan, Minn., is owned by investment firms Ares Management and Providence Equity Partners and Ayala Corp., a holding company based in the Philippines.

The deal is expected to close in the first quarter of 2014.

Convergys on Monday also backed its expectations for 2013, for revenue of nearly $2.05 billion and adjusted earnings from continuing operations of $1.10 per share. Analysts polled by FactSet, on average, were anticipating revenue of $2.05 billion on earnings of $1.10 per share.

Shares of Convergys soared nearly 20 percent to $25 in after-hours trading. Its stock slipped 16 cents to close regular trading at $20.86 Monday.