15 Jul 2020 16:46
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 ("MAR").
Purplebricks Group plc
("Purplebricks" or the "Company" or the "Group")
Sale of Canadian business
Purplebricks, the leading UK hybrid estate agency business, today announces that it has completed the disposal of its Canadian business, which includes the DuProprio and Purplebricks Canada operations ("PBDP"), to the Desjardins Group, a Canadian cooperative financial group, for cash proceeds of $60.5m Canadian Dollars (approximately £35m), subject to minor adjustments for completion working capital and completion debt, and which includes repayment of intra-Group debt owed by PBDP to be repaid to Purplebricks immediately following completion.
The disposal of PBDP simplifies the Group's operations and fits with its strategy of focusing on its core market in the UK, where there is substantial opportunity to grow its market-leading hybrid model. Following receipt of proceeds, the Group will hold a net cash balance of £66m. The net proceeds will be used to further strengthen the Group's financial position and invest in its UK business.
The agreement for sale includes customary terms and conditions for a transaction of this nature, including customary representations, warranties and indemnities given by Purplebricks to the Desjardins Group as well as certain restrictive covenants provided by both Purplebricks and the Desjardins Group. Purplebricks will grant PBDP a licence to continue to use the Purplebricks brand in Canada for a transitional period until December 2021.
PBDP had an adjusted operating loss of £(2.8)m for the 10 months ended 30 April 20191 and the book value of its gross assets as at 31 October 2019 was £11.4m.
Vic Darvey, Chief Executive Officer commented:
"Over the last 14 months, Purplebricks has reset its strategy to give the Company a strong foundation for the next phase of its growth. The Company's hybrid, digitally enabled model is more relevant than ever and this simplification of the business will allow management to focus its time and the Company's resources on delivering growth in the core UK market. The Board wishes the teams at DuProprio and Purplebricks Canada the very best in their new venture - and I would like to thank them personally for the collaboration and mutual sharing of knowledge and expertise over the last couple of years."
Notes:
1. The 10 months represents the period from 06 July 2018, being the date of acquisition of the Canadian business.
2. In Purplebricks' half year results HY21, the Canadian business will be reported as a discontinued activity.
For further information, please contact:
Purplebricks Group plc | investors@purplebricks.com |
Vic Darvey, Chief Executive Officer | |
Andy Botha, Chief Financial Officer | |
Zeus Capital (NOMAD) | + 44 (0)20 3829 5000 |
Daniel Harris/Nick Cowles | |
Torch Partners (Financial Advisor) | + 44 (0)20 7227 8830 |
Tom Roberts/Richard Ludwig | |
Buchanan (PR) | +44 (0)20 7466 5000 |
David Rydell/Jamie Hooper/Kim van Beeck |
About Purplebricks
Purplebricks is the UK's leading hybrid real estate agency. Purplebricks combines highly experienced and professional Local Property Experts with innovative technology to help make the process of selling, buying or letting more convenient, transparent and cost effective. Purplebricks shares are traded on the London Stock Exchange AIM market.
Additional Information
The person responsible for arranging the release of this announcement on behalf of the Company is Andy Botha, Chief Financial Officer.
The release, publication or distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the United Kingdom should inform themselves about, and observe, any applicable requirements. This announcement has been prepared for the purposes of complying with the UK AIM Rules and MAR and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with laws and regulations of any jurisdiction outside of England.
This announcement contains certain forward-looking statements. No forward-looking statement is a guarantee of future performance and actual results or other financial condition or performance measures could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as 'may', 'will', 'seek', 'continue', 'aim', 'anticipate', 'target', 'projected', 'expect', 'estimate', 'intend', 'plan', 'goal', 'believe', 'achieve' or other words of similar meaning. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of these are beyond the Company's control. As a result, actual results may differ materially from the plans, goals, and expectations contained in this announcement.
Any forward-looking statements made in this announcement speak only as of the date they are made. Except as required by the FCA, London Stock Exchange plc or applicable law or regulation, the Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this announcement to reflect any changes in the Company's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.
The amounts described in this announcement in CAD have been converted into GBP at an exchange rate of 0.585. References to £ or GBP are to pounds sterling and $ or CAD are to Canadian Dollars.