PTY.L Regulatory News (PTY)

26 Jan 2006 07:01

Parity Group PLC26 January 2006 26 January 2006 Parity Group plc Disposal of French and German businesses Parity Group plc ("Parity" or the "Group") today announces the sale ofsubstantially all of its continental European operations. Parity has enteredinto an agreement with GFT Technologies AG ("GFT"), a listed German Corporation,under which GFT will acquire the issued share capital of a number of Parity'sEuropean subsidiaries in Germany and France (the "Disposal"). GFT has agreed toacquire Parity's German business, Parity Beteiligungsgesellschaft GmbH, and itssubsidiaries and Parity's French business, Parity Eurosoft SARL, (together "Parity Europe") for a total cash payment of EUR7.7 million as well as assumptionof external borrowings expected to amount to EUR0.7 million. The cash paymentcomprises EUR5.9 million for the share capital of Parity Europe and thesettlement of EUR1.8 million of intra-group and third party debt. Parity Europewill be sold on a cash free basis together with existing bank borrowings which,at completion, are estimated to amount to EUR0.7 million. Completion isexpected to take place on 31 January 2006. Based on the statutory accounts for the companies being sold, Parity Europereported profits before tax for the year ended 31 December 2004 of EUR0.6million (£0.4 million) on turnover of EUR33.7 million (£22.9 million). Thevalue of the gross assets of Parity Europe as at 31 December 2004 was EUR10.4million (£7.4 million). The disposal of Parity Europe is in line with the Group's stated strategy ofdisposing of its non-UK businesses, focusing its operations on the UK andreducing the Group's indebtedness. Following the Disposal, Parity's remainingoperations in continental Europe will be in Holland, Belgium and Switzerland andthe Group continues to consider its options in relation to these businesses. This disposal is also consistent with the announcement made by the Group on 9December 2005, in which it indicated that the Board is focusing on the reductionof the Group's indebtedness. The proceeds of the Disposal will be used for thispurpose but, as stated, in order to grow the business, the balance sheet must bestrengthened further and as previously indicated the Board will be progressingdiscussions with shareholders to this end. Enquiries: Financial Dynamics - 020 7831 3113 Giles SandersonHarriet KeenCass Helstrip This information is provided by RNS The company news service from the London Stock Exchange