restructure in the US

Focus Solutions Group PLC 03 April 2003 3 April 2003 Focus Solutions Group plc Focus restructures in the US Focus Solutions Group plc ("the Group"), the specialist provider of sales automation solutions, is today announcing the sale of 51% of the issued share capital of its US subsidiary, Focus Solutions Holdings Inc, (which owns 100% of Focus Solutions Inc) on 31st March 2003, to the US management of Focus Solutions Inc for a nominal consideration. Focus Solutions Holdings Inc Group, ("FSHG") which comprises both Focus Solutions Holdings Inc and its subsidiary, Focus Solutions Inc, has been developing solutions for the US life assurance market based on the Group's XML toolkit, goal:technology. FSHG had net liabilities of approximately £0.1 million as at the 31st March 2003 after the capitalisation as share capital of an intercompany loan of £1.5 million. Losses for the year ending 31st March 2003 are estimated to be £0.9 million. The Group incurred costs in the order of £0.3 million in the year ended 31st March 2003 as a result of the transaction, including the costs of the associated closure of the Group's Boston office, which provided support services to Focus Solutions Inc. Goodwill write off will be approximately £1.0 million, in addition to £0.2 million amortised in the first half of the financial year. The sale of 51% of the issued share capital of Focus Solutions Holdings Inc follows a review of the US market by the Group's Board of directors ("the Board"). Current trading conditions in the US continue to be extremely tough and whilst opportunities have been identified, the Board believes that FSHG is likely to continue to need significant cash investment. The Board has concluded as a result, that it is in the best interests of the shareholders of the Group, to reduce the Group's exposure to the costs of developing its position in the US market. By retaining a 49% investment in Focus Solutions Holdings Inc, the Board will ensure that shareholders stand to benefit from any future success of FSHG, without the obligation for continuing investment. The Group's 49% interest in Focus Solutions Holdings Inc will be included in the Group accounts at a nominal value. The arrangements under which Focus Solutions Inc previously used the Group's goal:technology software, have been formalised by the grant of a non exclusive licence, allowing it to continue to use goal:technology to build its solutions for the North American life assurance market and other defined territories. Certain of the continuing rights and obligations, under the terms of the acquisition documentation governing the Group's purchase of Focus Solutions Inc in 2002, have been terminated by completion of this disposal, including employment contracts with Focus Solutions Inc and the obligation on the Group to pay any deferred consideration. One of the members of the Focus Solutions Inc management team, Thomas W. McCahill (who was a director of Focus Solutions Inc prior to completion of this transaction) has acquired approximately 49% of the issued share capital of Focus Solutions Inc as part of this transaction. The Directors of the Group, having consulted with Evolution Beeson Gregory, consider that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned. Outlook As anticipated in the interim statement, the Group has continued to grow its core business within the UK life and pensions market. The measures announced today, together with the cost savings announced at the half year underpin the Board's confidence in the future. The Group will be announcing its results for the year ended 31 March 2003 in early June, which, excluding the exceptional losses on disposal, the Board believes will be broadly in line with market expectations. Whilst trading conditions have been challenging, and are likely to remain so in the short term, the Board is committed to securing the Group's position as a leading supplier of e-trading solutions and is confident about its prospects in its core market. Enquiries Focus Solutions Group plc 01926 468300 John Streets Citigate Dewe Rogerson 020 7638 9571 Chris Barrie Sara Batchelor Notes to editors 1. About Focus Solutions Group Focus Solutions Group is a specialist provider of sales automation solutions for the financial services industry. Based on goal:technology, its XML toolkit, Focus delivers straight through electronic processing to create a paperless sales process across multiple channels to market including IFA portals, websites, extranets, direct sales and call centres. Focus has a portfolio of market facing propositions and services to help customers to implement and use its technology effectively. The Group has specific expertise in Point of Sale systems, having developed RIO, Norwich Union's POS solution for their direct sales, tied agents and telemarketing channels. RIO won the Financial Sector Technology award 2003 for 'Best Use of IT in Insurance' Focus's customer base includes: Misys Financial Services, The Exchange, Friends Provident, IFAengine, Legal & General, Norwich Union, Prudential, Scottish Equitable, Scottish Provident, Scottish Widows, Skandia, Standard Life and Zurich. For further information on Focus Solutions, please visit www.focus-solutions.co.uk. This information is provided by RNS The company news service from the London Stock Exchange
UK 100

Latest directors dealings