Get in touch: send your photos, videos, news & views by texting YORK to 80360 or send an email»
CPP confirms takeover approach
ONE of York’s largest private employers has confirmed it is in takeover talks with an American company.
CPP, the provider of card and identity protection, which employs about 1,000 people in the UK, mostly in York, said it had received an “initial, preliminary approach from Affinion Group Inc, which may or may not lead to an offer being made for the group.”
CPP, which made the announcement to the London Stock Exchange yesterday, stressed that the matter was at a “very early stage” and said: “There can be no certainty that an offer will be made or as to the terms of any such offer, should one be forthcoming.”
But York’s council leader and the local MP said they were concerned by the news.
Coun James Alexander, city council leader, said: “CPP is a large and longstanding employer in the city so I’m concerned that any change to the ownership of the company does not affect their continued presence in York and that staff, many of whom are also York residents, are supported throughout.”
York Central MP Hugh Bayley said: “Despite its recent difficulties, CPP is a market leader, a very strong company with a record of innovation. I can see why it is attractive to a foreign buyer.
“Its strength in the UK is its base in York and I would want any buyer to make it clear that they will maintain York as their centre of operations in the UK.”
Yesterday’s announcement came after CPP’s share price more than doubled to 22p since October 25. Yesterday, it rose to 29½p.
Chris Steward, stockbroker with Redmayne Bentley in York, said: “News of the possible takeover is some potentially good news for shareholders, but even after the recent rally the shares are still down 90 per cent from the level prior to the FSA investigation and it will therefore be small comfort.
“American firms, especially in finance, are not known for their sentimentality and if a takeover does go through job losses are a real possibility. However, the fundamental viability of CPP has been at stake as banks shy away and the takeover would be likely to give significantly more certainty for employees overall.”
Affinion Group, which markets membership, insurance, and loyalty programs with offices in 12 countries, including Slough in the UK, has been given until November 28 by the Takeover Panel to clarify whether or not it intends to make an offer.
The business, which is headquartered in Stamford, Connecticut, has provided identity theft, credit card and fraud protection and security services since 1969, adding a credit monitoring product in 1992 and has since developed a range of computer security software. In April 2007, it acquired identity theft protection, data monitoring and analysis technology solutions company CardCops, based in Malibu.
The announcement comes only days after CPP updated the market on its continuing discussions with the Financial Services Authority over misselling claims.
It said the FSA had extended the restriction preventing it from selling its card protection and identity protection products to include mobile phone insurance too, while the company implemented changes within the business agreed with the FSA.
It said revenues were down six per cent in the period from June 30 to date, on 2011. Underlying operating profit reduced and the group warned that its performance would continue to suffer from the FSA investigation next year, although it expected to remain profitable and hoped to bring the investigation to a close in 2013.
Comments are closed on this article.