The acquisition price would be in the range of $35 to 40m (Rs 157 to 200 crore) first reported Business Standard earlier today first reporting the news and citing unnamed sources.

The deal was announced by Thomson Reuters earlier today but did not disclose a deal value. Its legal division’s president and chief executive officer said in a press release that legal outsourcing added a vital strategic complement to the company’s portfolio of “specialised information and workflow solutions”, and would be key to helping law firms and corporate legal departments be more “responsive and cost-effective”.

"Pangea3 is true to our mission to help the legal system perform better, every day, worldwide; we will now bring to the legal marketplace a responsive, high-quality, transformative resource for a broad range of legal support work,” he added in the statement.

Pangea3 declined to comment when contacted by Legally India yesterday. Pangea3 and Thomson Reuters told Business Standard that they did not comment on speculation although neither denied the news.

In June 2010 Pangea3 told Legally India that it was planning to invest Rs 48 crore ($10.6m) in its Delhi office within two years to make the location outgrow its head office Mumbai. Pangea3 then had a headcount in Mumbai of 500, with 70 staff being based in Delhi.

Pangea3 has seen two private equity investments since it was founded in 2004, with Glenrock Group LLC investing $4m in 2006 and Sequoia Capital taking a $7m stake in 2007.

The LPO was founded by former Monster.com general counsel David Perla and OfficeTiger CFO and general counsel Sanjay Kamlani, who are understood to have continued holding significant equity stakes in the company following the capital raising rounds.

Thomson Reuters, which has no businesses in the LPO space, acquired Indlaw Communications in 2009, which provides legal database services in India. Thomson Reuters was formed when news wire Reuters was absorbed by Thomson Corporation in 2008. The erstwhile Thomson Corporation also owns legal research database services such as Westlaw and legal publisher Sweet & Maxwell.

Last week US-Indian LPO UnitedLex bought California-headquartered LawScribe, which also has offices in Gurgaon.

Updated at 10:21, 19 November with official Pangea confirmation of the news.

Update 19 November 16:13: Read Legally India's exclusive interview with Pangea3 co-founder Sanjay Kamlani discussing future expansion plans.