Exela Technologies Completes $40 Million Divestment of SourceHOV Tax as Part of Strategic Plan to Sell Non-Core Business Asse...
Exela Technologies, Inc. (“Exela” or the “Company”) (NASDAQ:
XELA), a location-agnostic global business process automation (BPA)
leader across numerous industries, today announced that it has
completed the divestment of its tax consulting group, SourceHOV
Tax, for a purchase price of $40 million to Private Equity firm
Gainline Capital Partners. Raymond James & Associates, Inc.
served as the exclusive financial advisor to Exela.
This is the first strategic divestment of non-core
business units for Exela as part of its previously announced
initiative, and follows a $160 million accounts receivable
securitization facility that closed in January. While SourceHOV
Tax’s trusted services continue to play important roles in meeting
the needs of CPA firms, corporations and other organizations, they
are no longer core to Exela’s global long-term strategy. This
divestment enables the Company to further focus on its key business
areas by streamlining its portfolio holdings, while at the same
time increasing its financial flexibility.
“We are excited to have successfully completed this
divestment, which instantly increases our liquidity and diversifies
our funding capabilities as key part of our strategic plan shared
in Q3 2019,” said Ronald Cogburn, Chief Executive Officer of Exela.
“This milestone not only improves our balance sheet in the near
term, but also further enables the company to focus on its core
business where we are best positioned for sustained long-term
growth. With this transaction, we are becoming even better
positioned to serve our customers by optimizing Exela’s business
portfolio and focus.”
For more than three decades SourceHOV Tax has
helped CPA firms and their clients maximize specialized federal and
state tax incentives. The company collaborates with accounting
firms throughout the country to bring R&D tax credits, cost
segregation, §179D, LIFO, §199, Fixed Asset Review,
and §45L solutions to their clients. With a team of 70
professionals and offices throughout the country, SourceHOV Tax
serves many of the nation’s most prominent accounting firms,
associations, and middle-market companies.
SourceHOV Tax generated $20.7 million of revenue
for the year ended December 31, 2019.
About Exela Technologies
Exela is a business process automation (BPA)
leader, leveraging a global footprint and proprietary technology to
provide digital transformation solutions enhancing quality,
productivity, and end-user experience. With decades of expertise
operating mission-critical processes, Exela serves a growing roster
of more than 4,000 customers throughout 50 countries, including
over 60% of the Fortune® 100. With foundational technologies
spanning information management, workflow automation, and
integrated communications, Exela’s software and services include
multi-industry department solution suites addressing finance and
accounting, human capital management, and legal management, as well
as industry-specific solutions for banking, healthcare, insurance,
and public sectors. Through cloud-enabled platforms, built on a
configurable stack of automation modules, and over 22,000 employees
operating in 23 countries, Exela rapidly deploys integrated
technology and operations as an end-to-end digital journey
Certain statements included in this press release are not
historical facts but are forward-looking statements for purposes of
the safe harbor provisions under The Private Securities Litigation
Reform Act of 1995. Forward-looking statements generally are
accompanied by words such as “may”, “should”, “would”, “plan”,
“intend”, “anticipate”, “believe”, “estimate”, “predict”,
“potential”, “seem”, “seek”, “continue”, “future”, “will”,
“expect”, “outlook” or other similar words, phrases or expressions.
These forward-looking statements include statements regarding our
industry, future events, the estimated or anticipated future
results and benefits of the Business Combination, future
opportunities for the combined company, and other statements that
are not historical facts. These statements are based on the current
expectations of Exela management and are not predictions of actual
performance. These statements are subject to a number of risks and
uncertainties, including without limitation those discussed under
the heading “Risk Factors” in Exela’s most recently filed Annual
Report on Form-10-K filed with the Securities and Exchange
Commission. In addition, forward-looking statements provide Exela’s
expectations, plans or forecasts of future events and views as of
the date of this communication. Exela anticipates that subsequent
events and developments will cause Exela’s assessments to change.
These forward-looking statements should not be relied upon as
representing Exela’s assessments as of any date subsequent to the
date of this press release.
Find out more at www.exelatech.com.
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