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Gi Group to acquire Work Service
Posted on Thursday, 13 February 2020 15:04
Gi Group has agreed to pick up a controlling interest Poland-based staffing provider Work Service for PLN 210.20 million (EUR 53.84 million).

The investment will allow the target to fully stabilise its financial situation in the coming months and to focus on growth and business development.

Recruitment firm Gi Group is acquiring 56.0 per cent of Work Service and will issue a tender offer to gain up to at least 66.0 per cent, according to the Polish stock exchange regulation at the time the transaction will be completed.

Headquartered in Italy, the buyer also plans to arrange or provide both bridge financing of EUR 4.70 million and long-term funding of EUR 44.60 million in order to meet the group’s debt obligations and restructure its balance sheet.

The news comes one month after Work Service’s main shareholders announced a preliminary deal to sell 55.9 per cent of the company to an investor for PLN 0.30 per share.

Work Service is a leading player of personnel services in Central and Easter Europe, with the sector having an estimated value of EUR 3.30 billion in the region and Poland accounting for EUR 1.50 billion of this amount.

The company counts customers in the industrial, automotive, logistics and retail sectors, hiring over 40,000 employers on a daily basis, according to its website.

Listed in Warsaw, Work Service’s shares rose 20.6 per cent to PLN 0.55 at 14:37 today, giving the business a market capitalisation of PLN 36.07 million.

During the nine months ended 30th September 2019, the group generated sales revenue of PLN 1.24 billion, down 21.0 per cent from PLN 1.57 billion in the corresponding period of 2018.

Earnings before interest, taxes, depreciation and amortisation totalled PLN 37.36 million in the same timeframe, compared to a loss of PLN 4.06 million in Q1-3 2018.

Zephyr, the M&A database published by Bureau van Dijk, shows there were 78 deals targeting human resources consulting service providers announced worldwide in 2019.

Morneau Shepell agreed to buy Mercer’s US large market health and defined benefits administration business for USD 57.00 million in the largest of these.

© Zephus Ltd