Exela Technologies, Inc. (“Exela” or the “Company”) (NASDAQ: XELA,
XELAP), a business process automation leader, today announced that
its Board of Directors (the “Board”) has authorized Exela to
consider a spin-off of its wholly-owned subsidiary, Exela
Technologies BPA, LLC, to Exela stockholders to maximize
shareholder value.
The potential spin-off, if completed, would
likely be structured so that all Exela stockholders as of
a record date in the third or fourth quarter of 2024, to be
determined by the Board, would (i) receive their pro-rata share of
a newly formed holding company owning Exela’s business process
automation business (the “BPA Business”) and (ii) continue to own
Exela, as currently constituted, including its greater than 70%
ownership in Nasdaq-listed XBP Europe Holdings, Inc. (held through
subsidiaries remaining with Exela) and the North American onsite
services business, but without the BPA Business.
No action or payment will be required by Exela
stockholders to receive shares of the BPA Business or any cash in
lieu of fractional shares that would be paid in connection with the
spin off. A registration statement containing details regarding the
distribution of the shares of the BPA Business, the management
following the spin-off, and other information regarding the
spin-off will be made available to Exela stockholders prior to any
distribution date. The closing of any distribution will be subject
to customary conditions that will be set forth in the registration
statement to be filed by the BPA Business, including final approval
of the Board and effectiveness of the registration statement.
Exela is evaluating whether, for U.S. federal
income tax purposes, the potential spin-off qualifies as a tax-free
distribution under Section 355(a) of the Internal Revenue Code. If
a potential spin off is consummated, Exela stockholders are urged
to consult with their tax advisors with respect to the U.S.
federal, state, and local or foreign tax consequences, as
applicable, of the potential spin-off.
Loeb & Loeb LLP is serving as legal
counsel to Exela on the potential spin-off.
Further details regarding the potential
spin-off, once finalized, will be shared in public filings with the
Securities and Exchange Commission. There can be no assurance,
however, that the potential spin-off transaction will be completed
in the manner described above, or at all.
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The information posted on the Company's website
and/or via its social media accounts may be deemed material to
investors. Accordingly, investors, media and others interested in
the Company should monitor the Company's website and its social
media accounts in addition to the Company's press releases, SEC
filings and public conference calls and webcasts.
About Exela Technologies
Exela Technologies is a business process
automation (BPA) leader, leveraging a global footprint and
proprietary technology to provide digital transformation solutions
enhancing quality, productivity, and end-user experience. With
decades of experience operating mission-critical
processes, Exela serves a growing roster of more than
4,000 customers throughout 50 countries, including over 60% of the
Fortune® 100. Utilizing foundational technologies spanning
information management, workflow automation, and integrated
communications, Exela’s software and services include
multi-industry, departmental solution suites addressing finance and
accounting, human capital management, and legal management, as well
as industry-specific solutions for banking, healthcare, insurance,
and the public sector. Through cloud-enabled platforms, built on a
configurable stack of automation modules, and approximately 13,600
employees operating in 20 countries, Exela rapidly
deploys integrated technology and operations as an end-to-end
digital journey partner.
Forward-Looking
Statements
Certain statements included in this press
release are not historical facts but are forward-looking statements
for purposes of the safe harbor provisions under The Private
Securities Litigation Reform Act of 1995. Forward-looking
statements generally are accompanied by words such as "may",
"should", "would", "plan", "intend", "anticipate", "believe",
"estimate", "predict", "potential", "seem", "seek", "continue",
"future", "will", "expect", "outlook" or other similar words,
phrases or expressions. These forward-looking statements include
statements regarding our industry, future events, estimated or
anticipated future results and benefits, future opportunities for
Exela, and other statements that are not historical facts. These
statements are based on the current expectations of Exela
management and are not predictions of actual performance. These
statements are subject to a number of risks and uncertainties,
which are and will be detailed (i) with respect to Exela, in
Exela's Annual Report on Form 10-K and other securities filings,
and (ii) with respect to the BPA Business, in the BPA Business's
registration statement to be filed with the SEC (as may be amended
from time to time). In addition, forward-looking statements provide
Exela's expectations, plans or forecasts of future events and views
as of the date of this communication, which are subject to
uncertainty, and changes in circumstances including, without
limitation, whether the spin-off will be consummated on the
expected terms, or at all. These forward-looking statements should
not be relied upon as representing Exela's assessments as of any
date subsequent to the date of this press release and Exela does
not undertake any responsibility to update these forward-looking
statements.
Investor
and/or Media
Contacts:
Vincent Kondaveeti
E: vincent.kondaveeti@exelatech.com
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