CPP sells stake in home emergency business
TROUBLED CPP Group has sold its stake in the Home3 emergency assistance business.
York-based CPP has sold its 49% stake in Home3 Assistance to its joint venture partner Mapfre Abraxas Software for £275,000.
As part of its exit from the joint venture arrangement CPP has agreed to invest a further £1m to absorb its share of the unrecognised losses in Home3, which will be reported as part of discontinued operations in the group’s income statement for the year ending December 31, 2014.
CPP, an insurer that specialises in ID and credit card theft protection, was fined £10.5m by the Financial Conduct Authority in 2012 for mis-selling insurance products and is paying out £65.8m in compensation to customers.
CPP will make the net cash payment of £725,000 to Mapfre over a two-year period. CPP will recognise a profit on disposal of approximately £275,000, less any associated disposal costs, as there are no relevant net assets recorded on the group balance sheet at the date of the transaction.
The loss after tax attributable to the group’s investment in Home3 for the year to December 31, 2012 was £477,000.
Brent Escott, CPP Group chief executive, said: “The sale of our shareholding in Home3 represents further progress in repositioning the business model to provide longer term stability for the group.”
