Sage Group PLC Disposal of US Payroll outsourcing business (1624N)
16 January 2019 - 12:01AM
UK Regulatory
TIDMSGE
RNS Number : 1624N
Sage Group PLC
15 January 2019
Disposal of US Payroll outsourcing business
15 January 2019
In its full year results announcement on 21 November 2018, Sage
announced that it was holding Sage Payroll Solutions ("SPR"), the
US-based payroll outsourcing business, for sale. Sage has now
entered into an agreement for the sale of SPR to iSolved HCM, LLC
("iSolved"). iSolved is a portfolio company of Accel-KKR and a
provider of human capital management solutions.
This divestiture is part of Sage's strategy, as set out in the
November 2018 results, to focus on subscription software solutions
that are in or have a pathway to the Sage Business Cloud.
As disclosed at the FY18 results announcement, SPR had revenue
of GBP38m and operating loss of GBP1m for the year ended 30
September 2018. The total sale consideration is approximately
GBP78m, of which GBP73m is payable in cash on completion (subject
to a customary debt and working capital adjustment) and the
remaining GBP5m represents contingent consideration. Sage expects
to report a statutory profit on disposal of approximately GBP23m on
completion.
The transaction is subject to certain completion conditions,
including clearance (or deemed clearance upon expiration of the
applicable waiting period) under the US Hart-Scott-Rodino Antitrust
Improvements Act. Completion is expected to occur within the next
three months. Proceeds will be invested for growth and used to
reduce net debt.
Enquiries
The Sage Group plc +44 (0) 191 294 3897
Lauren Wholley, Investor Relations Director
Amy Lawson, EVP Communications
Derk Bleeker, EVP Corporate Development
FTI Consulting +44 (0) 20 3727 1000
Charles Palmer
Dwight Burden
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