Sedgwick buys Cambridge Solutions' US arm for Rs 102 cr
BPO firm Cambridge Solutions today said it will sell off its US-based subsidiary's Cambridge Integrated Services operations to Sedgwick Claims Management Services for nearly Rs 101.9 crore ($22.7 mn).
Reacting to the announcement of the sale -- which includes workers' compensation and third party administration operations -- shares of Cambridge Solutions surged 19.97% to hit the upper circuit at Rs 37.85 apiece on the Bombay Stock Exchange.
In view of the unsatisfactory returns and significant future commitments of the Cambridge Integrated Services Group, Inc (CISGI) business, the board of directors in its meeting held on May 31, 2011, approved the sale of the USA workers' compensation and third party administration operations of CISGI to Sedgwick Claims Management Services, Inc, Cambridge Solutions said in a filing to the Bombay Stock Exchange.
Further, the company added, "The consideration to be paid by Sedgwick is $22.7 million, which will be paid in cash on May 31, 2011, of which $3 million will be held in escrow for up to 18 months."
The transaction will be reflected as a discontinued operation in Q2, 2011.
"Selling the CISGI operations to Sedgwick, the market leader, will provide our customers and employees with a good home for the future," Cambridge Solutions Executive Director and Vice Chairman and acting Chief Executive Officer Ken Lever said.
Sedgwick Claims Management Services is a provider of innovative claims and productivity management solutions.