Providence Service Corporation Announces Sale of Mission Providence Joint Venture to Konekt
August 11 2017 - 6:00AM
The Providence Service Corporation (“Providence”) (Nasdaq:PRSC)
today announced the sale of Mission Providence Pty Ltd (“Mission
Providence”) to Konekt Limited (“Konekt”), a market leading
provider of return to work solutions throughout Australia.
Mission Providence was formed in 2014 as a joint venture between
Providence and Mission Australia to provide employment services
under the Australian Government Department of Employment’s
jobactive programs.
Konekt will acquire 100% of Mission Providence for total
consideration of approximately USD $23 million (based on current
exchange rates). Of this total consideration, Providence is
expected to receive approximately USD $17 million (based on current
exchange rates) for its 75% interest in the joint venture.
“Mission Providence has emerged into an important employment
services provider in the Australian market over the last two
years,” said James Lindstrom, Providence’s President and Chief
Executive Officer. “We believe Konekt’s local presence and
leadership in workforce solutions will aid in Mission Providence’s
growth, innovation and ability to serve its client in a more
comprehensive way. Finally, the transaction represents an
example of Providence’s value enhancement philosophy, the outcomes
of which drive operational excellence with integrity and provide
additional capacity for higher return opportunities.”
For the twelve months ended December 31, 2016, Mission
Providence generated revenues of USD $37 million and a net loss of
USD $11 million. Providence has historically accounted for
its joint venture interest in Mission Providence as an equity
method investment; thus, the joint ventures financial results are
not consolidated with Providence’s reported revenue, Adjusted
EBITDA, or Adjusted Net Income.
Mission Providence will operate as a stand-alone division within
the Konekt business and Konekt intends to retain locations and
staff to facilitate a smooth transition for employees and
jobseekers.
The transaction is subject to obtaining formal approval by the
Australian Government Department of Employment and is expected to
close in the fourth quarter of 2017.
About Providence
The Providence Service Corporation is a holding company which
owns interests in subsidiaries and other companies that are
primarily engaged in the provision of healthcare and workforce
development services for public and private sector entities seeking
to control costs and promote positive outcomes. For more
information, please visit prscholdings.com.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as “believe,” “demonstrate,” “expect,” “estimate,”
“forecast,” “anticipate,” “should” and “likely” and similar
expressions identify forward-looking statements. In addition,
statements that are not historical should also be considered
forward-looking statements. Readers are cautioned not to place
undue reliance on those forward-looking statements, which speak
only as of the date the statement was made. Such forward-looking
statements are based on current expectations that involve a number
of known and unknown risks, uncertainties and other factors which
may cause actual events to be materially different from those
expressed or implied by such forward-looking statements. These
factors include, but are not limited to, our continuing
relationship with government entities and our ability to procure
business from them, our ability to manage growing and changing
operations, the implementation of healthcare reform law, government
budget changes and legislation related to the services that we
provide, our ability to renew or replace existing contracts that
have expired or are scheduled to expire with significant clients,
and other risks detailed in Providence’s filings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K. Providence is under no obligation to (and
expressly disclaims any such obligation to) update any of the
information in this press release if any forward-looking statement
later turns out to be inaccurate whether as a result of new
information, future events or otherwise.
Investor Relations Contact
David Shackelton – Chief Financial Officer
(203) 307-2800
Providence Service (NASDAQ:PRSC)
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