Mergermarket: Cielo Seeks Acquisition for China Footprint, CEO Says

Cielo CEO, Sue Marks, was spotlighted this week in an article by Mergermarket, an online intelligence and news service “for anyone involved in mergers and acquisitions.” The article, Cielo Seeks Acquisition for China Footprint, CEO Says (paid subscription required), features Sue emphasizing Cielo’s desire to make an acquisition in China to gain entry into the country.

As Sue explains, with Cielo growing globally, adding new technology-enabled services and expanding geographically, the company is looking to “fill out areas where we are small and to gain a footprint in areas where we have no business.”

Excerpts from the article:

Brookfield, Wisconsin-based Cielo, the new name taken on after the July 2013 merger of Pinstripe and Ochre House, is looking for a company in China with “the right kind of licenses and that is very clean from a compliance perspective,” Sue Marks said. If it fits that criteria, the target could be small or large, she added, without elaborating on size.

Majority backed by Accel-KKR (management and employees own the rest), Cielo had 2013 revenue of USD 103.5 million and is projecting 30% top-line growth this year ... Depending on size, deals could be funded through cash, debt and equity from existing and/or new investors, Marks added. The company is handling the acquisition process internally, with support from Accel-KKR.

Cielo provides recruitment process outsourcing (RPO) and strategic talent management services. It has 100 mainly large global customers that typically have between 5,000 and 100,000 employees.


Cielo has a strong presence in North America, the UK and Europe, and the Middle East. It more recently entered regions including the Czech Republic, Qatar, Hong Kong, Singapore, Turkey and Saudi Arabia, Marks said. The company is also eyeing Latin America.


Based on Cielo’s business portfolio, one of the industry sources suggested Beijing-based Career International and China Talent Group, and Sichuan-based VASTSEA Executive Search as ideal partners in the RPO business. All have more than CNY 100m (USD 16.3m) in revenue, the source said. Shanghai-based Bluesea Group could also be a target as it has a strong human resource outsourcing business and is expected to increase its efforts in RPO, according to the other source, who said Bluesea had revenue of more than CNY 50m (USD 8.1m) last year.


Other top domestic players include state-owned China International Intellectech Corp. and Shanghai Foreign Service, as well as listed online recruiters including 51job (NASDAQ:JOBS) and Zhaopin (NYSE:ZPIN), according to the 2014 report titled “The Rankings and White Paper of Best Human Resources Service Brands in Greater China,” published by local human resources media company HRoot.

As a merged entity with 1,100 employees, Cielo is now competing with larger players such as Korn Ferry and Accenture, Marks said ... The company expects continued growth of 25%-30% annually.