Acquisition of the remaining 50.1% of PT Healthcare Solutions Corporation

Quindell Plc
(“Quindell”, the “Company” or the “Group”)

Acquisition of the remaining 50.1% of PT Healthcare Solutions Corporation

Quindell Plc (AIM:QPP.L) announces that it has today agreed to acquire the remaining 50.1% stake that it does not already own in PT Healthcare Solutions Corporation (“PT Health”) in consideration for the issue of 9,466,666 ordinary shares of 15 pence each in the Company (“Ordinary Shares”) (the “Acquisition”).

Background

PT Health is a leading provider of physiotherapy and rehabilitation services in Canada, with close to 100 owned clinics and an established network of 150 additional locations which provides complete national coverage. Historically, PT Health generated business from General Practioner referrals and government funded walk-in patients. However, since becoming part of the Group, its focus has shifted to the insurance referral model which yields higher margin recurring revenues from road traffic accident injured insurance customers, and to recurring revenues from Preferred Provider Networks for large national employers under their extended healthcare benefits programs.

On 26 September 2013, the Company announced that it had acquired a 26% interest in PT Health in consideration for the issue of 2,103,418 Ordinary Shares. In addition, the Company announced that it had agreed a put and call option (the “Option”) with the vendors of PT Health, enabling Quindell to acquire the remaining 74% of PT Health subject to certain conditions.

Following a variation of the Option, the Company announced on 31 March 2014 that it had acquired a further 23.9% stake in PT Health in consideration for the issue of 6,666,666 Ordinary Shares.

For the period from 1 April 2014 to 31 December 2014, PT Health reported revenue of CDN$38.7 million (£19.1 million), a net loss of CDN$20.7 million (£10.2 million), a loss adjusted for non-recurring items and before tax of CDN$2.8 million (£1.4 million) and net assets of CDN$41.8 million (£20.6 million).

Transaction

Pursuant to the Option, the Group is to acquire the remaining 50.1% of PT Health, the terms of which have now been agreed and are detailed in an arrangement agreement (the “Arrangement Agreement”). Under the terms of the Arrangement Agreement, Quindell will issue 9,466,666 Ordinary Shares in consideration for the Acquisition.

The Acquisition is to be effected pursuant to an arrangement under the Canada Business Corporations Act. Completion of the Acquisition is subject to customary closing conditions, including court approval of the arrangement, approval of two-thirds of the votes cast by the holders of PT Health common shares at a special meeting of shareholders to be called to consider the arrangement, and applicable regulatory approval. Following a review and analysis of the proposed transaction, the PT Health board has unanimously approved the transaction and recommends that PT Health’s common shareholders vote in favour of the arrangement. In addition, all of the directors and executive officers of PT Health have signed agreements to vote their shares in favour of the transaction. The Acquisition is scheduled to close in mid-October 2015.

PT Health is deemed to be a related party of the Company for the purposes of the AIM Rules, and is a party to the Arrangement Agreement. The directors of the Company consider, having consulted with Peel Hunt LLP in its capacity as the Company’s nominated adviser, that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned.

PT Health is currently treated as a subsidiary of the Group and consolidated into the Group’s accounts. Post completion of the Acquisition, PT Health will become a wholly owned subsidiary of Quindell.

Completion of the Acquisition is expected to take place in mid-October 2015 and application will be made for the 9,466,666 Ordinary Shares to be admitted to AIM in due course.