CPPGroup Plc Related Party Transaction
RNS Number : 2039T
21 July 2022
21 July 2022
("CPP Group", the "Group" or the "Company")
Related Party Transaction
CPP Group (AIM: CPP), a provider of assistance and insurance
products, which reduce disruptions to everyday life for millions of
customers across the world, has entered into amended arrangements
with the founders of Globiva Services Private Ltd ("Globiva").
The Group holds a 51% majority interest in Globiva, a Business
Processes Management company incorporated in India, with the other
49% of the shares beneficially owned by the three founders of
Globiva, Navneet Gupta, Vikram Singh Nathawat and Ashish Goyal ,
who continue to manage the business (the "Globiva Founders").
Globiva's results to 30 June 2022 are in line with expectations and
ahead of prior year comparatives, with the business benefiting from
improved trading conditions and notable new client wins.
Following an internal review and discussions with the Globiva
Founders, the Board considers that the Shareholder Agreement
("SHA") signed in September 2018 included unrealistic commitments
from the Group for the utilisation of Globiva's call-handling
capacity; performance targets which it is now unable, and would
never have been able, to satisfy. As a result, the Group has agreed
to amend the SHA and certain other arrangements, as further set out
CPP will provide additional funding of GBP0.5 million to Globiva
through an existing repayable interest-bearing loan facility, which
will be utilised to provide a one-time compensation payment to the
Globiva Founders. Subsequently the balance on the repayable loan
from the Company to Globiva will stand at circa GBP1.7 million,
however, there are circumstances in which the Company may consent
in the future to waive the amounts due.
The SHA further entitled, upon achievement of certain
performance targets, the Globiva Founders to either a cash payment
or to buyback 10% of the ordinary shares in Globiva from CPP Group,
at the discretion of the Company. Under the amended arrangements,
the Globiva Founders will, on meeting performance targets, buyback
10% of the ordinary shares in Globiva from CPP Group, however, in
the normal course of business, it has been agreed this cannot be
triggered until 1 January 2026 at the earliest.
The compensation payment to the Globiva Founders, who are also
Directors of Globiva, along with the other arrangements described
above, constitute a related party transaction under AIM Rule 13.
The Directors of CPP Group consider, having consulted with the
Company's nominated adviser, Liberum Capital Limited, that the
terms of the transaction are fair and reasonable insofar as the
Company's shareholders are concerned.
Simon Pyper, CEO of CPP Group, commented:
"The agreement we have reached with Globiva strengthens our
relationship and provides a sound footing on which the business can
continue to grow strongly and to the benefit of all parties."
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as amended by The
Market Abuse (Amendment) (EU Exit) Regulations 2019. Upon the
publication of this announcement via the Regulatory Information
Service, this inside information is now considered to be in the
CPP Group plc
Simon Pyper, Chief Executive via Alma PR
David Bowling, Chief Financial
Liberum Capital Limited
(Nominated Adviser and Sole Tel: +44 (0)20 3100 2000
(Financial PR Adviser) Tel: +44 (0)20 3405 0205
About CPP Group:
CPP Group is a technology-driven assistance company that creates
embedded and ancillary real-time assistance products and resolution
services that reduce disruption to everyday life for millions of
people across the world, at the time and place they are needed, CPP
Group is listed on AIM, operated by the London Stock Exchange.
For more information on CPP visit
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July 21, 2022 02:00 ET (06:00 GMT)
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