Cambridge Solutions gets approval to sell its US subsidiary Operations division to Sedgwick

Xchanging Solutions Ltd. | IT - Software | IT & ITES | BSE: 532616 | NSE: XCHANGING

01 Jun 2011 Evaluate

Cambridge Solutions 100% US subsidiary - Cambridge Integrated Services Group Inc, USA (CISGI) has received approval for the sale of the USA worker’s compensation and third party administration operations (Operations) of CISGI to Sedgwick Claims Management Services, Inc (Sedgwick). The consideration to be paid by Sedgwick is $22.7 million which will be paid in cash of which $3 million will be held in escrow for up to 18 months.

The sale includes the worker’s compensation claims, managed care, consumer claims, professional liability claims, the structured settlements operations of CISGI, virtually all of CISGI’s contracts. CISGI and Sedgwick will also enter into a transition services agreement to facilitate a smooth handover of the operations. The transaction will be reflected as a discontinued operation in the Q2 2011.

In view of the unsatisfactory returns and significant future commitments of the CISGI business, the Company’s board at its meeting held on May 31, 2011 has decided the approval of the sale of Operations business of its CISGI. The company has incurred operational losses continuously over recent years due to continue decline in revenue generated in the business.

Cambridge Solutions along with its subsidiaries is a business solutions provider offering consulting, business process outsourcing, Enterprise and IT services. With operations across the globe, the company’s key verticals include banking and financial services, insurance, manufacturing and logistics, emerging markets, finance and accounting and claims management.