Iain Dale 7pm - 10pm
Capita sells software division for £115m
28 January 2022, 07:54
The outsourcer is on a selling spree to offload non-core assets to raise £700m to pay down debt.
Outsourcing giant Capita has agreed to sell its software resale, licensing and technology services business Trustmarque for £115 million.
The deal is the latest in a long line of sales by the company as it slims down its non-core assets to raise £700 million – a target hit six months early.
Capita first bought Trustmarque in 2016 for £57 million and will offload the business to One Equity Partners.
It will receive £111 million now and a further £3 million if the business hits certain targets in the future.
Trustmarque provides services to global tech firms and saw revenues of £122 million in 2020 and pre-tax profits of £16 million. Current management and staff will continue running operations under the new owners.
Capita chief executive Jon Lewis has said the company aims to sell off £700 million of assets to focus on its Capita Public Service and Capita Experience divisions.
The former provides support services to Government, including the Royal Navy, HMRC, the Standards and Testing Agency and London Congestion Charge, whilst the latter works with the private sector including major banks, the RSPCA and Thames Water.
Recent results showed its public sector work saw growth of 11% but its private sector contracts were hit by 8% falls.
Mr Lewis said: “I am delighted that, once this sale is completed, we will have exceeded our disposals target – and achieved this much earlier than originally planned.
“It marks another significant step towards materially reducing our debt, as we continue to simplify and strengthen Capita, and become a more successful business for the long term.
“We are now focused on selling the remaining businesses in our Portfolio division, with the goal of disposing of the majority by the end of 2022.”
Earlier this month it completed the sale of its Secure Solutions and Services business, which provides software to the emergency services and justice sectors, to NEC Software Solutions UK for £62 million.
Its biggest sell-off was its educational software division, Education Software Solutions (ESS), to Montagu for £400 million in December 2020.