Capita Plc agrees to sell software businesses to AdvancedAdvT

LONDON, UK: Capita plc confirms that it has agreed to sell software businesses CIBS, CHKS, Retain, WFM and Synaptic to AdvancedAdvT Limited for an enterprise value of £33 million on a cash-free, debt-free basis.

Including cash and debt-like items and typical working capital adjustments, Capita expects to receive cash proceeds of c£44m on completion, including c£9m of cash within the sold businesses at the time of the transaction.

These five businesses collectively represent Capita’s non-core software assets in its Portfolio disposals division. They have limited overlap with the rest of core Capita.

The company previously announced its intention to sell a number of non-core businesses to strengthen the balance sheet and focus on its two core divisions, Capita Public Service and Capita Experience.

AdvancedAdvT (LSE: AdvT) buys and invests in software and services businesses with the focus on organic growth and synergistic M&A.

The combined reported revenue and profit before tax of the non-core software businesses for the year to 31 December 2022 were £35m and £3m respectively. Gross assets were £81m at 31 December 2022.

The sale to AdvancedAdvT is subject to National Security and Investment Act approval.

The senior management team and employees will remain with their businesses as they transfer to the ownership of AdvancedAdvT.

The agreement to sell these non-core software businesses follows the agreement to sell our critical messaging services business PageOne and completion of the divestment of our Resourcing and Security Watchdog businesses in May.

Jon Lewis, Capita’s Chief Executive Officer, said: “We are pleased to have agreed the sale of these non-core software businesses to AdvancedAdvT following a competitive sale process.

“The sale marks another step for our successful disposals programme which has enabled us to significantly strengthen the balance sheet and materially reduce our debt.

“We continue to target for the majority of the remaining businesses within our non-core Portfolio division to be sold during the first half of 2023, depending on general market conditions.”

Capita is being advised on this transaction by Deloitte.

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