Morse sells French business
12 July 2005 | 2741 views | 0
Source: Morse plc
Morse plc (Morse), the consulting, technology and support company, announces that it has sold its business in France, Morse France SAS, to Opengate Capital (UK) Holdings Limited for a maximum consideration of approximately €1.0m comprising an initial consideration of €1 and a further €1.0m payable in cash in the period to 30 June 2007, if the business achieves certain financial targets.
Morse's strategy has, for a number of years, been focused on transitioning the business from a pure reseller to a consulting technology and support company. In its Q3 sales performance update in April 2005, Morse announced its intention to accelerate this transition due to the trading environment for infrastructure.
Given that a substantial proportion of the revenues of Morse's French business were derived from infrastructure and that significant further financial and management investment would have been required to transform it into a higher value-added business, this business was no longer considered core to the Group.
As at 30 June 2004, Morse France SAS had gross assets of €26.2m and in the year to 30 June 2004 generated an operating loss of €3.7m. The sale of this business will result in a non-cash exceptional charge of £7.0m in the period to 30 June 2006.
Commenting on the sale, Duncan McIntyre, Chief Executive of Morse plc, said: "The majority of Morse France SAS' activity was based around reselling and, as we continue to transition the Group, a decision was taken to dispose of this business and focus on developing other opportunities which we believe will provide higher shareholder returns."