NCO Group, Inc. (?NCO?) (Nasdaq: NCOG), a leading provider of accounts receivable management services, announced today that it has completed the divestiture of its Market Strategy division. TRC Holdings, Inc. and Creative Marketing Strategies, Inc., both management-led groups, will acquire the assets of the market research and telemarketing businesses, respectively.
Under the terms of the agreements, NCO will receive notes totaling $18.25 million in initial consideration. NCO may receive additional consideration in the form of an earn-out over the next three years from the market research business and an earn-out over the next five years from the telemarketing business. Furthermore, the $12.25 million note associated with the divestiture of the market research business will be increased by up to $2.0 million if the note is not repaid in full by December 31, 2002.
Commenting on the completion of the divestiture, Michael J. Barrist, Chairman and Chief Executive Officer, stated, ?As we stated in May of this year, we believe the divestiture is in the best interest of our shareholders based on the substantial investment of capital, as well as technological and management resources, required to maintain a competitive position in these industries. Given the number of initiatives currently under way in the accounts receivable management business, we feel that our shareholders are better served through our deploying those resources into our core business.?
Mr. Barrist added, ?We believe that the structure of these transactions represent our best opportunity in light of the current, difficult financing environment.?
NCO also provided historical quarterly statements of income for 1999 giving effect to the discontinued operations treatment of its Market Strategy division.
