Adecco to acquire professional staffing firm MPS Group

Tuesday, 20. October 2009 06:47
Corporate news announcement processed and transmitted by Hugin AS.
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The acquisition significantly strengthens Adecco's professional
staffing business, making Adecco the world leader in this attractive
market segment



Zurich, Switzerland, October 20, 2009: Adecco Group, the world's
leading provider of HR solutions, announced today the acquisition of
MPS Group, Inc. ('MPS Group'), a leading provider of professional
staffing services, for an enterprise value of EUR[1] 782 million, or
USD 13.80 per share. This acquisition will significantly enhance
Adecco's position in the professional staffing business, particularly
in the USA & Canada and the UK. Adecco expects the transaction to be
accretive on an adjusted EPS[3] basis in the first year and EVA[4]
positive within three years.

Patrick De Maeseneire, Chief Executive Officer of the Adecco Group,
comments: "We are delighted to have MPS Group become part of the
Adecco Group, in a move that will see Adecco taking the world-wide
lead in professional staffing. The acquisition of MPS Group is an
important step in Adecco's stated strategy to strengthen the higher
margin professional staffing business, which offers attractive growth
over the coming years. With this transaction and the successful
closing of the Spring Group acquisition, Adecco's revenue mix is
significantly improved with close to 25% of group revenues to be
generated in the professional staffing business. This is up from 17%
of group revenues based on 2008 results."

MPS Group is a leading provider of specialty staffing, consulting,
and business solutions across various professional business lines
such as information technology (Modis, Idea Integration), finance and
accounting (Accounting Principals and UK-based Badenoch & Clark),
legal (Special Counsel), engineering (Entegee) and healthcare
(Soliant Health). MPS Group is one of the largest professional
staffing firms in North America and also has a strong position in the
UK. In 2008, MPS Group generated revenues of EUR[2] 1.5 billion. MPS
Group achieved an average EBITDA margin of 6.3% between 2004 and
2008.

Joining forces with MPS Group will provide Adecco with a platform to
significantly expand its professional staffing business in the USA &
Canada and the UK. Together, Adecco and MPS Group provide compelling
staffing solutions to small & medium-size and large account clients
in the USA & Canada and UK.

Additionally, acquiring MPS Group enhances Adecco's Managed Service
Program (MSP) and Recruitment Process Outsourcing (RPO) offering
through MPS Group's leading technology platform (Beeline). Together,
both companies will become the leading provider of MSP and RPO
services and technology solutions. The flexibility to offer services,
technology or combined programs is increasingly becoming a strategic
advantage within the HR industry as clients seek to outsource HR
processes and to streamline their supplier relationships.

Adecco expects the transaction to be accretive on an adjusted EPS[3]
basis in the first year after closing. The acquisition will be EVA[4]
positive within three years, in line with Adecco's value based
strategy and financial discipline.

The combination of Adecco and MPS Group offers attractive synergy
potential through optimisation of the combined footprint and
operational / back-office functions, efficiency improvements, and
elimination of public company costs. Adecco expects to achieve EUR 25
million of annual synergies from the integration of MPS Group within
two years, representing approximately 0.5% of the pro-forma 2008
revenues of the USA & Canada and the UK. Integration costs are
expected to amount to approximately one times the annual synergies.

MPS Group's board of directors unanimously recommends Adecco's
proposed offer to its shareholders. MPS Group's expertise in
professional staffing is highly valued by Adecco and management is
excited by the infusion of talent MPS Group will bring to the Adecco
Group. Adecco is also strongly committed to pursue a multi-brand
strategy including MPS Group's portfolio of leading professional
staffing brands.

Details of the transaction
Under the terms of the acquisition agreement, it is proposed that MPS
Group shareholders will receive USD 13.80 in cash for each
outstanding MPS Group share the 'Offer', representing a premium of
24% to the closing share price of USD 11.14 on October 19, 2009 and a
premium of 27% to the volume weighted average share price of USD
10.87 over the 30 days through to October 19, 2009. On an enterprise
value basis, the Offer is EUR1 782 million, representing an
enterprise value/revenue multiple of 0.5x based on MPS Group's 2008
revenues and an enterprise value/EBITDA multiple of 9.9x based on the
average EBITDA over the last five years.

The transaction will be financed by Adecco's current cash resources
as well as existing financing capabilities. Adecco is strongly
committed to retain an investment grade rating. The transaction
remains subject to the MPS Group shareholder vote and regulatory
approvals. It is expected to close in the first quarter of 2010.


Q3 2009 Market Update
Adecco's trading in the third quarter of 2009 has developed fully in
line with Adecco management expectations. Over the course of the
third quarter market conditions improved. Adecco will report Q3 2009
results on November 5, 2009 at 7 a.m. (CET) 6 a.m. (GMT).


Closing of the acquisition of Spring Group plc
Adecco today also announced the successful closing of the acquisition
of Spring Group plc.

Invitation to media and analyst conference call
There will be a media and analyst conference call at 10 a.m. (CET) 9
a.m. (GMT). The dial-in numbers are as follows:


UK / Global + 44 (0)207 107 06 11
United States + 1 866 291 41 66
Cont. Europe +41 (0)91 610 56 00


Details for the webcast can be found at our Investor Relations
section at http://webcast.adecco.com


Contacts:

Adecco Corporate Investor Relations
Investor.relations@adecco.com or +41 (0) 44 878 89 89

Adecco Corporate Press Office
Press.office@adecco.com or +41 (0) 44 878 87 87

Forward-looking statements
Information in this release may involve guidance, expectations,
beliefs, plans, intentions or strategies regarding the future. These
forward-looking statements involve risks and uncertainties. All
forward-looking statements included in this release are based on
information available to Adecco S.A. as of the date of this release,
and we assume no duty to update any such forward-looking statements.
The forward-looking statements in this release are not guarantees of
future performance and actual results could differ materially from
our current expectations. Numerous factors could cause or contribute
to such differences. Factors that could affect the Company's
forward-looking statements include, among other things: global GDP
trends and the demand for temporary work; changes in regulation of
temporary work; intense competition in the markets in which the
Company competes; changes in the Company's ability to attract and
retain qualified internal and external personnel or clients; the
potential impact of disruptions related to IT; any adverse
developments in existing commercial relationships, disputes or legal
and tax proceedings.

About the Adecco Group
The Adecco Group, based in Zurich, Switzerland, is the world's
leading provider of HR solutions. With over 29,000 FTE employees and
more than 5,800 offices, in over 60 countries and territories around
the world, Adecco Group offers a wide variety of services, connecting
more than 500,000 colleagues with over 100,000 clients every day. The
services offered fall into the broad categories of temporary
staffing, permanent placement, outsourcing, consulting and
outplacement. The Adecco Group is a Fortune Global 500 company.

Adecco S.A. is registered in Switzerland (ISIN: CH0012138605) with
listings on the SIX Swiss Exchange (ADEN) and on Euronext in France
(ADE).

[1] Spot exchange rate: 1.49 USD/EUR
[2] Average 2008 exchange rate: 1.47 USD/EUR
[3] Excluding amortisation and integration costs
[4] Based on Adecco's cost of capital



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Adecco SA
Sagereistrasse 10 Glattbrugg Switzerland

WKN: 922031;
ISIN: CH0012138605; Index: SLCI, SMI, SPI, SMIEXP;
Listed: Main Market in SIX Swiss Exchange;

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