NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF
SUCH JURISDICTION
FOR IMMEDIATE RELEASE
23 June
2017
Capita plc
Sale of Capita
Asset Services to Link Group for £888 million
Capita plc (“Capita” or the “Group”) today announces the sale of
the Capita Asset Services businesses (“CAS”) to Link Administration
Holdings (“Link Group”) for a cash free, debt free consideration of
£888 million.
The transaction is subject to certain regulatory and other
approvals and completion is expected in Q4 2017.
Upon completion of the sale, after the deduction of transaction
expenses (including certain separation related costs, including a
£17 million one-off pension contribution) of approximately £72
million, the net cash proceeds are intended to be used to reduce
indebtedness, including the Company’s receivables financing
facility. Including the proceeds and excluding the EBITDA generated
by CAS, the pro forma net debt / EBITDA ratio would have been 1.8
times at 31 December 2016.
Commenting on the transaction, Andy
Parker, Chief Executive of Capita said:
“We are delighted to announce the
sale of the Capita Asset Services businesses to Link Group. In the
Autumn of last year we set out a strategy to simplify and
streamline Capita by repositioning the Group and refocusing on
delivering technology-enabled business and customer management
solutions that make business processes smarter and deliver better
customer service. This disposal is an important step in realising
this strategy. We have achieved an attractive price and the
reduction in leverage is significant and ensures that Capita can
fully focus on the pursuit of what it does best: continuing to
deliver outstanding services to our clients and their
customers.
“We have made good progress across
all the strategic initiatives we set out at the end of 2016. We
have re-structured to become a market-facing organisation with a
renewed focus on sales, completed our disposals of non-core
businesses which will result in a significant reduction in leverage
and made good progress in improving productivity and reducing costs
across the Group. The disposal of CAS, alongside our other
initiatives, makes Capita a leaner business with a stronger balance
sheet, better placed to return to profitable, sustainable
growth.”
-ENDS-
Enquiries:
Capita plc
Tel: 020 7799 1525
Shona Nichols, Executive Director,
Communications
Andrew Ripper, Head of Investor
Relations
Media enquiries
Capita Press Office Tel: 020 7654 2399
Powerscourt Tel: 07725 565545 and 020 7250 1446
capita@powerscourt-group.com
Victoria Palmer-Moore, Peter Ogden and Ben
Griffiths
Transaction Financial adviser to
Capita
Goldman Sachs International
Anthony Gutman
Charlie Lytle
Jose Barreto
Chris Emmerson
Market abuse regulation
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014.
Further information:
Capita plc
Capita is a leading UK provider of technology-enabled customer
and business process services and integrated professional support
services. With 73,000 people at over 450 sites, including 98
business centres across the UK, Europe, India
and South Africa, Capita uses its
expertise, infrastructure and scale benefits to transform its
clients' services, driving down costs and adding value. Capita is
quoted on the London Stock Exchange (CPI.L), with 2016 underlying
revenue of £4.9 billion.
Further information on Capita can be found at:
www.capita.com.
Capita Asset Services
CAS is a leading asset services platform, providing shareholder
solutions, corporate & private client solutions, fund solutions
and banking & debt solutions to a leading blue chip customer
base. CAS has over 3,000 employees servicing over 6,000 customers
predominantly across the UK, Ireland, Jersey and Luxembourg. For the 12 months ended
31 December 2016, CAS generated
operating profit of approximately £60.0 million, and had gross
assets of approximately £794 million as at the same date.
Link Administration Holdings (ASX
Code: LNK) (“Link Group”)
Link Group is a global provider of share registry, shareholder
management, analytics and fund administration.
www.linkgroup.com
Disclaimers
Goldman Sachs International, which is authorised by the
Prudential Regulation Authority and regulated by the Financial
Conduct Authority and the Prudential Regulation Authority in the
UK, is acting for Capita and no one else in connection with the
potential sale of the Capita Asset Services division and will not
be responsible to anyone other than Capita for providing the
protections afforded to its clients, or for giving advice in
connection with the potential sale of the Capita Asset Services
division.
Important Notice
This announcement is not for release, publication or
distribution directly or indirectly, in whole or in part, into or
from any jurisdiction where to do so would constitute a violation
of the relevant laws of such jurisdiction.
This announcement has been prepared for the purposes of
complying with applicable law and regulation in the United Kingdom and the information disclosed
may not be the same as that which would have been disclosed if this
announcement had been prepared in accordance with the laws and
regulations of any jurisdiction outside of the United Kingdom.
Forward looking statements
This announcement contains certain statements which are, or may
be deemed to be, "forward-looking statements". These statements are
based on current expectations and projections about future events
and are naturally subject to uncertainty and changes in
circumstances. These forward-looking statements may include
statements with respect to Capita plc's business, financial
condition and results of operations. Forward-looking statements
often use words such as "anticipate", "target", "expect",
"estimate", "intend", "plan", "budget", "schedule", "forecast",
"project", "goal", "believe", "hope", "aims", "continue", "will",
"may", "should", "would", "could", "subject to", or other words of
similar meaning. By their nature, forward-looking statements
involve known and unknown risks and uncertainties, because they
relate to events and depend on circumstances that will occur in the
future and the factors described in the context of such
forward-looking statements in this announcement could cause actual
results, outcomes and developments to differ materially from those
expressed in, or implied by, such forward-looking statements and
such statements are therefore qualified in their entirety by the
risks and uncertainties surrounding these future expectations. Many
of these risks and uncertainties relate to factors that are beyond
the entities' ability to control or estimate precisely. Important
factors that could cause actual results, performance or
achievements of Capita plc to differ materially from the
expectations of Capita plc, as applicable, include, among other
things: UK domestic and global economic and business conditions;
instability in the global financial markets, including Eurozone
instability and the impact of any sovereign credit rating downgrade
or other sovereign financial issues; market-related risks including
in relation to interest rates and exchange rates; changing
demographics and market-related trends; changes in customer
preferences; changes to laws, regulation, accounting standards or
taxation; the policies and actions of governmental or regulatory
authorities in the UK or the European Union or other jurisdictions
in which Capita plc operates; the ability to attract and retain
senior management and other employees; the extent of any future
impairment charges or write-downs caused by depressed asset
valuations, market disruptions and illiquid markets; the effects of
competition and the actions of competitors; exposure to regulatory
scrutiny, legal proceedings, regulatory investigations or
complaints and other factors.
Although it is believed that the expectations reflected in such
forward-looking statements are reasonable, no member of Capita plc
can give any assurance, representation or guarantee that such
expectations will prove to have been correct and such
forward-looking statements should be construed in light of such
factors and you are therefore cautioned not to place reliance on
these forward-looking statements which speak only as at the date of
this announcement. Capita assumes no obligation to update or
correct the information contained in this announcement (whether as
a result of new information, future events or otherwise), except as
required by applicable law or regulations.