Insurance products group accelerates disposal of non-core business
Leeds-headquartered CPP Group has completed the disposal of its 51% interest in Globiva Services Private Ltd for a total cash consideration of approximately £3.8m.
The group, which provides assistance and insurance products, held a 51% majority interest in Globiva, a business processes management company incorporated in India, with the other 49% of the shares beneficially owned by the three founders of Globiva, Navneet Gupta, Vikram Singh Nathawat, and Ashish Goyal.
On 27 November 2023, the group confirmed it had agreed with the founders to the disposal of its 51% interest in Globiva over a three-year period concluding in quarter one 2027.
The total aggregate consideration of about £4.7m was based on forecast EBITDA for the 2023, 2024 and 2025 financial years and subject to a maximum adjustment of plus or minus 10%.
However, since then Globiva’s earnings outlook has deteriorated due to a general slowdown in the Indian technology market.
At the request of the Globiva founders, CPP explains it agreed to accelerate the disposal of its interest in Globiva, previously scheduled to complete in quarter one 2027, and in accordance with its Original Agreement to apply the 10% reduction to price.
For the 2023 financial year, Globiva contributed EBITDA of £2.2m to the group’s overall EBITDA of £3.5m, albeit the group’s shareholders only ultimately benefited from 51% of Globiva’s results.
As of 31 December 2023, Globiva had net assets of £4.2m. Simon Pyper, CEO of CPP, said: “The accelerated disposal of Globiva is consistent with our strategy and is another positive step as we simplify the group and transform to a digitally led parametric business.“
