TIDMNWKI
RNS Number : 4680T
Networkers International PLC
08 June 2009
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8 June 2009
Networkers International plc (the 'Company')
Joint Venture Agreement
The Group today announces that it has reached an agreement with its Joint
Venture (JV) partner for the JV partner to purchase Networkers' stake in the JV
business for a total cash consideration of US$4.2m (approximately $3.5m net of
foreign taxes). The JV was set up in 2001 as a resource and project service
provider within the telecommunications and IT sector, originally operating in
Saudi Arabia but successfully establishing itself in Iran, UAE, Pakistan and
Algeria. Completion is conditional upon the approval of the Saudi Arabian
authorities which is expected to occur within the next two months.
Commenting on today's announcement, Spencer Manuel, CEO said "The joint venture
partnership has proved an extremely successful experience for the Group. The
disposal allows both parties to focus on further international expansion in
their respective geographical markets. During the 8 years of the partnership we
have built up a very strong relationship with our JV partners, Saudi Telecoms
Systems Limited, and I am pleased to announce that our 50:50 partnership located
in Dubai, to provide recruitment services in the Middle East (excluding Saudi
Arabia, Iran and Algeria) remains in place."
"When the full proceeds are received by the Group they will be used to further
reduce our net debt position which, even before accounting for the JV disposal,
has been reduced to GBP8m (of which GBP2m relates to invoice discounting) from
GBP20.7m in December 2006 when the debt was taken on to make the successful MSB
acquisition."
The JV contributed GBP240,000 to the Groups pre tax profit for the 6 month
period to 30 June 2008, at which point it was reclassified as an investment held
for resale and no additional profit has been attributed to the Group. As at 31
December 2008 the Group's share of the JV's net assets represented GBP1.7m
indicating a post tax profit on disposal of approximately GBP450,000.
The Group's cash investment in the JV totalled GBP122,000.
Enquiries:
Networkers International 020 8315 9000
Spencer Manuel, CEO
Jon Plassard, CFO
www.networkersmsb.com
Seymour Pierce Limited 020 7107 8000
Richard Feigen
Catherine Leftley
This information is provided by RNS
The company news service from the London Stock Exchange
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