Capita Asset Services is sold for nearly £900m
Capita has sold an arm of its business to technology outsourcer Link Administration Holdings, not the debt purchaser, for nearly £900m.
Link has acquired Capita Asset Services, which offers services including debt servicing and NPL due diligence, for a cash free, debt free consideration of £888m.
The transaction is subject to certain regulatory approvals and is expected to be complete by the end of December this year.
The net cash proceeds of the sale are intended to reduce Capita’s indebtedness – including its receivables financing facility.
These proceeds are estimated to be around £72m after transaction expenses are deducted, which includes a one-off pension contribution of £17m.
Capita Asset Services administers around £600bn of assets and in 2016 managed about £45bn in annual payments for its customers.
Andy Parker, chief executive of Capita, said the acquisition has been an important part of the company’s plan to streamline.
Michael Carapiet, group chairman at Link, said: “Our management team has spent a significant amount of time assessing growth opportunities for Link Group in offshore markets and this acquisition materially expands Link Group’s footprint in the UK and Europe in business lines we understand well.”