KANSAS CITY, Mo., June 14, 2016 /PRNewswire/ -- DST Systems,
Inc. (NYSE: DST), a global provider of specialized technology,
strategic advisory, and operations outsourcing to the financial and
healthcare industries, announced that it has entered into a
definitive agreement to sell its North American Customer
Communications ("NACC") business to Broadridge Financial Solutions,
Inc. (NYSE:BR), for cash consideration of $410.0 million, subject to customary working
capital and other closing adjustments (the "Transaction").
Broadridge is a leading global provider of investor communications
and technology-driven solutions for capital markets, wealth
management, and asset management firms and corporations. The
Transaction is expected to close in July
2016, and follows the completion of a sale and leaseback
transaction of three of DST's U.S. production facilities and its
Canadian production facility announced in October 2015 for pre-tax proceeds totaling
$129.0 million.
With over 2,300 employees and four production facilities located
in El Dorado Hills, CA,
South Windsor, CT, Kansas City, MO, and Markham, Ontario, Canada, NACC is the largest
transactional printer in North
America and a leading provider of customer communication
services including print and digital communication solutions,
content management, postal optimization and fulfillment.
Steve Hooley, Chairman and CEO of
DST said, "The sale of the North American Customer Communications
business is an important step in executing our well-defined
strategy of focus and growth within our financial and healthcare
services segments. In connection with on-going strategic
review of DST businesses, our management team and Board of
Directors have decided to exit the customer communications
business. As a result, we are also currently pursuing the
divesture of our U.K. Customer Communications business. We
are confident that this is the right time to obtain the full value
of the Customer Communications businesses on behalf of our
shareholders so that we can more fully realize the opportunities
within our core Healthcare and Financial Services segments and
continue driving long-term growth and value creation at DST."
Hooley continued, "We are confident that Broadridge is the right
partner for our North American Customer Communications business as
they are best-positioned to support evolving client requirements by
taking advantage of their large-scale multi-channel print and
digital communications platform."
DST estimates that the pending sale of the NACC business will
result in after-tax proceeds of approximately $310.0 million. The Company intends to use its
net after tax proceeds in accordance with its capital plan
including investments in the business, share repurchases, strategic
acquisitions, debt repayments and other corporate purposes. Once
completed, the North American Transaction is expected to result in
a reduction to DST's earnings per share of approximately
$1.15 on an annual basis, excluding
any impacts of the use of proceeds from the sale.
During April 2016, DST spent
$75.0 million to purchase 0.7 million
DST shares, which completed the existing share repurchase
plan. Concurrent with the approval of the Transaction, the
Board of Directors of DST authorized a new $300.0 million share repurchase plan.
BofA Merrill Lynch is acting as financial advisor to DST and
Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal
counsel.
About DST
DST Systems, Inc. is a leading provider of
specialized technology, strategic advisory, and business operations
outsourcing to the financial and healthcare industries. Combining
unmatched industry knowledge, critical infrastructure and service
excellence, DST helps companies master complexity in the world's
most demanding industries to ensure they continually stay ahead of
and capitalize on ever-changing customer, business and regulatory
requirements. For more information, visit the DST website at
www.dstsystems.com.
Safe Harbor Statement
Certain material presented in this release includes
forward-looking statements intended to qualify for the safe harbor
from liability established by the Private Securities Litigation
Reform Act of 1995. These forward-looking statements include, but
are not limited to, (i) all statements, other than statements of
historical fact, included in this report that address activities,
events or developments that we expect or anticipate will or may
occur in the future or that depend on future events, or (ii)
statements about our future business plans and strategy and other
statements that describe the Company's outlook, objectives, plans,
intentions or goals, and any discussion of future operating or
financial performance. Whenever used, words such as "may," "will,"
"would," "should," "potential," "strategy," "anticipates,"
"estimates," "expects," "project," "predict," "intends," "plans,"
"believes," "targets" and other terms of similar meaning are
intended to identify such forward-looking statements.
Forward-looking statements are uncertain and to some extent
unpredictable, and involve known and unknown risks, uncertainties
and other important factors that could cause actual results to
differ materially from those expressed or implied in, or reasonably
inferred from, such forward-looking statements. Factors that could
cause results to differ materially from those anticipated include,
but are not limited to, the risk factors and cautionary statements
included in the Company's periodic and current reports (Forms 10-K,
10-Q and 8- K) filed from time to time with the Securities and
Exchange Commission. All such factors should be considered in
evaluating any forward-looking statements. The Company undertakes
no obligation to update any forward-looking statements in this
release to reflect new information, future events or
otherwise.
Media Contact:
Laura M.
Parsons
DST Global Public Relations
+1 816 843 9087
mediarelations@dstsystems.com
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SOURCE DST Systems, Inc.