London: Public sector consulting and outsourcing group Capita has acquired Applied Language Solutions Ltd, ALS, for an initial £7.5 million. ALS provides translation and interpreting services to the public and private sector, with clients including Google, Sony and Caterpillar.
In August 2011 ALS was awarded a framework agreement with the Ministry of Justice (MoJ). The MoJ and its partners, including Her Majesty's Courts and Tribunal Service, the Crown Prosecution Service, Her Majesty's Prison Service and police forces across England and Wales, will be able to sign contracts under the agreement for the delivery of interpreting and translation services.
The framework is expected to deliver cost savings in excess of £60m over 5 years, greatly reducing the criminal justice sector's spend in this area.
Capita is acquiring ALS for £7.5m, on a cash free, debt-free basis, with a further contingent consideration of up to £60m, based on profit performance and staged over the next 4 years. The latter consideration is based on ALS achieving growth targets in line with the successful roll-out of the MoJ contract and greater penetration of the UK language services market.
ALS made a pro forma operating loss for its financial year to May 2011 of £0.3m on turnover of £10.6m.
Capita Group Chief Executive, Paul Pindar, said, 'The acquisition adds a new service to the range of those the Capita Group is able to offer to both the public and private sectors. By combining ALS's specialist skills and proprietary technology with Capita's operational expertise and balance sheet we believe that this will allow us to become a very strong player in the language services industry. There are excellent opportunities for organic growth both in the UK and internationally.'
ALS, which will form a new standalone business within the Capita Group, has around 130 employees based in the UK, India, Europe and the US and contracts with 17,000 translators across the globe.