Teleperformance acquires Senture, a leading BPO* operator for US government services

PARIS–(BUSINESS WIRE)–Regulatory news:

Teleperformance (Paris:TEP), a leading global provider of integrated digital business services, today announces the acquisition of Senture, a leading business process outsourcing (BPO) operator for government services in the United States, from of Kingswood Capital Management, LP (Kingswood), an American private investment firm based in Los Angeles, California.

Founded in 2003 and headquartered in London, Kentucky, with revenue of US$192 million and an adjusted EBITA margin of 16% (2021e), Senture offers a unique onshore citizen experience delivery model that is well aligned with US government requirements.

Government services (federal, state and local) account for nearly 80% of Senture’s revenue, while commercial healthcare support services account for the remaining share. Senture’s citizen support activities are specifically designed to address queries in the areas of health, education, transportation and social services.

For Teleperformance, the logic of the acquisition is based on three elements:

Teleperformance pursues its strategy of vertical specialization by strengthening its citizen offers, already active in the US, UK, Continental Europe, Middle East, Asia and Africa; the acquisition opens up new growth opportunities in the United States.

Senture benefits from a solid financial situation, with strong revenue growth and an EBITA margin higher than that of Teleperformance.

The transaction is accretive to Teleperformance’s earnings per share of around +5%.

The consideration for the transaction (enterprise value) is US$400 million. The acquisition is entirely financed by debt. Paul Hastings LLP acted as legal counsel to Teleperformance in connection with the acquisition. Goodwin Procter LLP and Robert W. Baird & Co. Incorporated acted as legal and financial advisors to Senture and Kingswood, respectively, in connection with the acquisition.

Daniel Julien, Chairman and CEO of Teleperformance, said: “Senture provides essential services to a large number of customers in the high-potential US government services market. It’s a large organization with a growing onshore network of over 4,500 advisors, 85% of whom work from home. This acquisition will strengthen the Group’s global leadership in the consumer services vertical, which offers strong growth potential worldwide, particularly in the United States. It also has a positive impact on Teleperformance’s profitability profile. This acquisition is part of Teleperformance’s vertical specialization strategy.

“Once completed, the transaction will create immediate value for Teleperformance shareholders as it is expected to be earnings accretive on a pro forma basis for 2021,” he added.

“Senture is a truly differentiated asset in the government BPO industry,” said Alex Wolf, managing partner of Kingswood. “We are extremely grateful to Senture and its management team for their partnership and tireless execution under our stewardship, which has resulted in significant growth, strengthened market positioning and impressive diversification into new verticals. This investment is a perfect example of Kingswood’s value-added operational improvement strategy.

*Subcontracting

Conference call with analysts and investors

A conference call to discuss the details of the transaction will take place on January 3rd2022 at 6:15 p.m. CEST.

Call number :

France: +33 1 70 37 71 66

UK: +44 33 0551 0200

USA: +1 212 999 6659

The webcast will be available live or delayed on:

https://channel.royalcast.com/landingpage/teleperformance/20220103_1/

The conference call slides will be available at the following link:

https://www.teleperformance.com/en-us/investors/publications-and-events/other-events/

Indicative calendar for investors

2021 annual results: February 17, 2022

ABOUT THE TELEPERFORMANCE GROUP

Teleperformance (TEP – ISIN: FR0000051807 – Reuters: TEPRF.PA – Bloomberg: TEP FP), a leading global group of integrated digital services for businesses, serves as a strategic partner to the world’s largest companies in many industries. It offers a One Office support services model combining three main families of high value-added solutions: customer experience management, back-office services and business process knowledge services. These end-to-end digital solutions ensure successful customer interaction and optimized business processes, rooted in a unique and comprehensive high-tech and tactile approach. The Group’s more than 380,000 employees, based in 83 countries, support billions of connections every year in more than 265 languages ​​and more than 170 markets, in a common commitment to excellence under the “Easier, faster, safer”. This mission is supported by the use of reliable, flexible and intelligent technology solutions and adherence to the highest industry safety and quality standards, based on excellence in corporate social responsibility. In 2020, Teleperformance achieved consolidated revenue of €5,732 million ($6.5 billion, based on €1 = $1.14) and net profit of €324 million.

Teleperformance shares are listed on the Euronext Paris market, compartment A, and are eligible for the deferred settlement service. They are included in the following indices: CAC 40, CAC Support Services, STOXX 600, S&P Europe 350 and MSCI Global Standard. In terms of corporate social responsibility, the Teleperformance share is part of the Euronext Vigeo Eurozone 120 index, the FTSE4Good index and the Solactive Europe Corporate Social Responsibility index (formerly the Ethibel Sustainability Excellence Europe index).

For more information: www.teleperformance.com Follow us on Twitter: @teleperformance

Ashley C. Reynolds