Business
Related Party Transaction
Related Party Transaction.
About this update from Cpp Group Plc
[{"type":"text","content":"\n \n \n \n 21 July 2022\n \n \n \n \n CPPGroup Plc\n \n \n \n (\"CPP Group\", the \"Group\" or the \"Company\")\n \n \n \n Related Party Transaction\n \n \n \n CPP Group (AIM: CPP), a provider of assistance and insurance products, which reduce disruptions to everyday life for millions of customers across the world, has entered into amended arrangements with the founders of Globiva Services Private Ltd (\"Globiva\").\n \n \n The Group holds a 51% majority interest in Globiva, a Business Processes Management company incorporated in India, with the other 49% of the shares beneficially owned by the three founders of Globiva, Navneet Gupta, Vikram Singh Nathawat and Ashish Goyal\n ,\n who continue to manage the business (the \"Globiva Founders\"). Globiva's results to 30 June 2022 are in line with expectations and ahead of prior year comparatives, with the business benefiting from improved trading conditions and notable new client wins.\n \n \n \n \n \n Following an internal review and discussions with the Globiva Founders, the Board considers that the Shareholder Agreement (\"SHA\") signed in September 2018 included unrealistic commitments from the Group for the utilisation of Globiva's call-handling capacity; performance targets which it is now unable, and would never have been able, to satisfy. As a result, the Group has agreed to amend the SHA and certain other arrangements, as further set out below. \n \n \n \n \n \n CPP will provide additional funding of £0.5 million to Globiva through an existing repayable interest-bearing loan facility, which will be utilised to provide a one-time compensation payment to the Globiva Founders. Subsequently the balance on the repayable loan from the Company to Globiva will stand at circa £1.7 million, however, there are circumstances in which the Company may consent in the future to waive the amounts due.\n \n \n \n \n \n The SHA further entitled, upon achievement of certain performance targets, the Globiva Founders to either a cash payment or to buyback 10% of the ordinary shares in Globiva from CPP Group, at the discretion of the Company. Under the amended arrangements, the Globiva Founders will, on meeting performance targets, buyback 10% of the ordinary shares in Globiva from CPP Group, however, in the normal course of business, it has been agreed this cannot be trig...