PROACTIS Holdings PLC Conclusion of Formal Sales Process (9087E)
March 04 2020 - 2:00AM
UK Regulatory
TIDMPHD
RNS Number : 9087E
PROACTIS Holdings PLC
04 March 2020
4 March 2020
Proactis Holdings PLC
Conclusion of Formal Sales Process
Proactis Holdings PLC ("Proactis", the "Group" or the
"Company"), the global spend management solution provider,
announces the conclusion of the formal sale process ("FSP")
announced on 29 July 2019.
The FSP was commenced to enable the Board, in an orderly
fashion, to explore a number of approaches and expressions of
interest which the Board considered had the potential to provide
benefit to the Group's stakeholders. A comprehensive process was
run to assess the credibility of interested parties and their
ability to deliver an offer or strategic outcome that could be
recommended to shareholders. This has not led to any firm proposals
being received and it is unlikely that prolonging this process will
deliver a proposal that the Board would be willing to recommend to
shareholders.
The Board is mindful of the potential commercial and management
distraction that a protracted FSP could present to the Group and
also of its encouraging prospects (as illustrated by the Group's
44% increase in total contract value of new business sold during
the 6 month period ended 31 January 2020 as described within the
trading update dated 20 February 2020). This rate of new business
has continued during February 2020 and the Group has now signed
approximately GBP9.4m of total contract value, cumulatively, during
the seven months ended 29 February 2020 (as a comparative, the
Group signed GBP11.3m for the whole financial year ended 31 July
2019).
The Board is confident that the right business strategy is in
place and some of the benefits of this are becoming evident
already. Furthermore, the Board will continue to focus on cost
control and to review non-core aspects of the business with a view
to reducing net debt further. The Board considers that superior
shareholder value will be achieved by focussing the Group's efforts
on delivery of this strategy rather than by engaging in the FSP at
this time. For this reason, the Board has concluded the FSP and the
Company is no longer in an "offer period" as defined by the
Code.
The Board recognises that this decision will not have achieved
the desired outcome for some shareholders and the Board is
committed to working with those shareholders to facilitate their
objectives, where possible.
Alongside this, the Board has committed to make certain changes
to its corporate governance infrastructure, including:
- To transition to a position within twelve months where, in
accordance with the UK Governance Code, at least half of the Board,
excluding the Chair, are independent non-executive directors;
- To amend the Company's Articles of Association at the next
General Meeting to require annual re-election for every director;
and
- To review the Group's reporting key performance indicators in
order to provide greater transparency and granularity as the Group
returns to growth.
Tim Sykes, CEO, commented:
"We believe we have come to the right conclusion for our
shareholders as a whole, considering the clear progress that has
been made in the business and the opportunities that we have ahead
of us.
"The business strategy that we have established is being
implemented and is delivering encouraging early indicators. As
communicated within our recent trading update, we have delivered a
significant improvement in new business and dramatically improved
retention rates and we expect a return to revenue growth in the
second half of this financial year. Our progress in the short-term
has been encouraging and we are confident that the long-term
prospects are significant."
For further information, please contact:
Proactis Holdings PLC
Tim Sykes, Chief Executive Officer 01937 545070 x1115 investorcontact@proactis.com
finnCap Ltd
Stuart Andrews/Carl Holmes/Matthew Radley - Corporate
Finance
Andrew Burdis/Richard Chambers - ECM 0207 220 0500
Alma PR 020 3405 0205
Rebecca Sanders-Hewett, Hilary Buchanan, Sam Modlin Proactis@almapr.co.uk
Notes to Editors:
Proactis creates, sells and maintains software and services
which enable organisations to streamline, control and monitor all
indirect expenditure. Its solutions are used in approximately 1,100
buying organisations around the world from the commercial, public
and not-for-profit sectors.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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