TORONTO, ONTARIO--(Marketwire - Dec 6, 2012) - People Corporation ("People" or the "Company") (TSX VENTURE:PEO) announced today that it is further expanding its national presence through the acquisition of Bencom Financial Services Group Inc. ("Bencom") in a transaction valued at approximately $5 million. Bencom was established in 1982, and provides group benefit solutions, group retirement solutions, and individual benefit solutions to approximately 200 mid-market corporate clients located primarily in Ontario. Based in Kitchener, Ontario, Bencom is committed to the highest standards in client service, which has resulted in a strong client base and a highly successful business. The acquisition has an effective date of December 3, 2012.
"The acquisition of Bencom is the third transaction we have closed since September 2012, and demonstrates the momentum we have in executing our growth strategy," commented Mr. Laurie Goldberg, Chairman and CEO of People Corporation. "Consistent with our previous acquisitions, the owners of Bencom recognized the unique value proposition that we offer partner companies, whereby they continue to run their businesses, but are able to leverage the resources and capabilities of a large, well-capitalized, national organization such as People Corporation, all of which ultimately benefit our clients."
"As a rapidly growing firm, we wanted to partner with a like-minded company that shared our vision, values and commitment to providing exceptional products, services and advice to our clients. We have found that partner in People Corporation," said Mr. David Young, Senior Partner of Bencom. "We are extremely pleased to be partnering with a very successful company like People Corporation, and believe that the access to proprietary products, additional resources and customized services that this partnership brings will benefit our existing valued clients and also provide a more dynamic platform for seeking new business opportunities."
Concurrent with the acquisition of Bencom, People Corporation also appointed Mr. Young as Vice-Chair, Corporate Initiatives of People Corporation. In this new and important role, in addition to continuing to contribute to the management of the Bencom business, Mr. Young will work closely with the senior management team at People Corporation on selected corporate initiatives. "Dave''s 30 years of experience in the benefits insurance industry, as well as his insight, perspective and past experience as Chairman of the Benefits Alliance Group, will make him a strong contributor to our team," commented Mr. Goldberg. Bencom''s other active principals, Mr. Dino Costabile, Mr. Mark Beckham and Ms. Silvia Weismann, will continue to have roles, and in some cases retain ownership interests, in Bencom''s business, with Mr. Costabile assuming the role of Practice Leader, responsible for overall direction and oversight of Bencom. "We welcome Dave, Dino, Silvia and Mark and all of the Bencom team to the People Corporation family, and look forward to working together to serve clients, grow the business, and create shareholder value," continued Mr. Goldberg.
The cash portion of the transaction will be financed through a combination of existing cash resources as well as drawing on the acquisition credit facility that the Company has in place with its bank, CIBC. Taking into account the drawings for this and previously announced transactions, People Corporation has drawn $3.75 million on its acquisition credit facility.
"This transaction is illustrative of our growth strategy - partner with talented entrepreneurs and consultants that have built strong businesses, and be flexible in our approach to transaction structuring, all with a view of ensuring a win-win-win scenario - for our clients, our consultants and partner companies, and for People Corporation," continued Mr. Goldberg. "We are very pleased with the momentum that the Company has in executing its focused growth strategy, and look forward to continuing to partner with successful entrepreneurs with a highly attractive value proposition."
People Corporation expects to release its financial statements for the year ended August 31, 2012 on or about December 10, 2012.
About People Corporation
People Corporation is a national provider of group benefits, group retirement and human resource services. We have offices across Canada, each led by a team of experts and backed by the resources of a national company that is traded on the TSX-V. Our industry experts provide uniquely valuable insight while customizing our innovative suite of services to the specific needs of our clients. Whatever your sector, whatever your scale, putting our expertise and proven track record to work will make a difference to your people and your bottom line.
Further information is available at www.peoplecorporation.com.
This news release contains "forward-looking information" within the meaning of applicable securities laws, such as information concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Use of words such as "may", "will", "expect", "believe", or other words of similar effect may indicate forward-looking information including the completion of the transaction, the impact of that transaction on our earnings and cash flow, and the anticipated benefits of the transaction. This information is not a guarantee of future performance and is subject to numerous risks and uncertainties, including those described in our publicly filed documents (which are available on SEDAR at www.sedar.com). Those risks and uncertainties include: our ability to maintain profitability and manage growth; strong competition from other consultants and changes in the current legislation could result in significant competition from the banking industry; failure of information systems and technology; dependence on key clients; seasonality of revenues and the resulting possible impairment on working capital; reliance on key professionals; additional financing may be required and may not be available under terms favourable to us; there can be no assurance that any suitable future acquisition will be available to us or that, if available, the terms of the acquisition will be favourable to us; and a change in general economic conditions. Many of these risks and uncertainties can affect our actual results and could cause our actual results to differ materially from those expressed or implied in any forward-looking information made by us or on our behalf. Given these risks and uncertainties, investors should not place undue reliance on forward looking information as a prediction of actual results. All forward-looking information in this news release is qualified by these cautionary statements. This information is made as of the date of this news release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward looking information, whether as a result of new information, future events or otherwise. Additionally, we undertake no obligation to comment on analyses, expectations or statements made by third parties in respect of the Company, its financial or operating results or its securities.
Non-IFRS Financial Measures
EBITDA, which is defined as earnings (loss) before interest, taxes, dividends, depreciation and amortization, is not a financial measure recognized by International Financial Reporting Standards ("IFRS") and does not have a standardized meaning prescribed by IFRS. Operating Income before Corporate Costs means EBITDA plus expenses incurred at the corporate office and expenses related to acquisitions ("Corporate Costs"). Analysis of these differences enables understanding of the operating leverage inherent in the financial results of an acquisitive company. Operating leverage is a term used to describe the quantum of acquired EBITDA that falls to EBITDA of a company following an acquisition and is useful to the understanding of the resulting incremental overheads and synergies. The Company believes that these Non-IFRS financial measures provide meaningful information on the Company''s performance and operating results. Readers are cautioned that EBITDA or the Company''s calculation of the Operating Income do not have standardized meanings as prescribed by IFRS and may not be comparable to similar measures presented by other companies. Further, readers are cautioned that EBITDA or Operating Income should not replace Net income or loss or cash flows from operating, investing and financing activities (as determined in accordance with IFRS), as an indicator of the Company''s performance.