Patriot National Announces Sale of Global HR Research
April 04 2017 - 6:45AM
Patriot National, Inc. (NYSE:PN) (“Patriot National” or “the
Company”), a leading provider of technology and outsourcing
solutions to the insurance industry, today announced that it sold,
on April 3, 2017, substantially all of the assets of Global HR
Research (“Global HR”), a pre-hire intelligence solutions provider,
to a subsidiary of Renovo Capital, LLC for total consideration of
up to $30 million.
The transaction reflects Patriot National’s strategic plan to
focus on its core businesses, workers’ compensation insurance
services and technology. The Board of Directors of Patriot National
approved the sale.
The purchase price for the sale of Global HR is up to $30
million, plus the assumption of certain liabilities.
Specifically, $20 million was paid to Global HR in cash at closing
and $5 million will be deposited into escrow for possible purchase
price and working capital adjustments, satisfaction of certain
post-closing conditions and any indemnification claims. In
addition, Global HR may receive an earnout payment of up to an
additional $5 million. The Company expects that the sale of
Global HR will impact its prior 2017 financial guidance, issued on
March 14, 2017, for Fee Income and Adjusted EBITDA for the balance
of the year by $13 million and $2 million, respectively.
About Patriot NationalPatriot National, Inc. is
a national provider of comprehensive technology and outsourcing
solutions that help insurance companies and employers mitigate
risk, comply with complex regulations and save time and money.
Patriot National provides general agency services, technology
outsourcing, software solutions, specialty underwriting and
policyholder services, claims administration services, self-funded
health plans and employment pre-screening services to its insurance
carrier clients, employers and other clients. Patriot National is
headquartered in Fort Lauderdale, Florida. For more
information about Patriot National, please visit
www.patnat.com.
Forward-Looking StatementsThis press release
may include statements that may be deemed to be forward-looking
statements. Words such as "may," "will," "should," "likely,"
"anticipates," "expects," "intends," "plans," "projects,"
"believes," "estimates," "positioned," "outlook," "Guidance," and
similar expressions are used to identify these forward-looking
statements including statements regarding potential additional
payments from the sale of Global HR. By their nature,
forward-looking statements involve risks and uncertainties, and
there are important factors that could cause actual results to
differ materially from those indicated in these statements,
including the following: the effect on our business if Guarantee
Insurance terminates its agreement with us, ceases to offer
workers’ compensation products, ceases operations, including due to
bankruptcy, liquidity or other financial difficulties or failure to
comply with insurance regulations; potential conflicts of interest
resulting from Mr. Mariano’s control of Guarantee Insurance; past
and potential future net losses; potential further impairment of
goodwill and intangible assets; potential inability to meet our
debt service obligations; the effect on our business of restrictive
covenants under our Credit Agreement and the potential failure to
comply with such covenants; a potential adverse outcome of the
litigation filed against us; a potential adverse impact on our
operations of general economic and labor market conditions and
trends in the insurance industry, including cyclicality; potential
decrease of premium rates, on which a significant portion of our
fee revenue is based; potential decline of workers’ compensation
claims in frequency or severity; development of unfavorable market
conditions or regulatory environment in Florida, California, New
Jersey, Georgia, New York and Pennsylvania, where our business is
concentrated; potential inability to grow our business organically;
potential failure to sustain our relationships with independent
retail agencies; potential changes in the healthcare industry;
potential failure to comply with applicable regulation or adapt to
new regulatory and legislative initiatives; inability to compete
effectively; failure or inadequate performance of our information
processing systems; cyber-attacks or other security breaches
involving our or our clients’ computer systems;, as well as those
matters contained in our filings with the Securities and Exchange
Commission. Although we base these forward-looking statements on
assumptions that we believe are reasonable when made, we caution
you that forward-looking statements are not guarantees of future
performance or events and that results may differ materially from
statements made in or suggested by the forward-looking statements
contained in this press release. Any forward-looking statement that
we may make in this press release speaks only as of the date of
such statement, and we undertake no obligation to update any
forward-looking statement or to publicly announce the results of
any revision to any of those statements to reflect future events or
developments.
Media and Investor Contact:
Cindy Campbell
Director of Investor Relations
Patriot National, Inc.
(954) 670-2907
CCampbell@patnat.com