Recently Pitney Bowes Inc. (PBI) announced its plan to sell the management services business wing in the United Kingdom and Republic of Ireland to Swiss Post Solutions.
Swiss Post Solutions is a division of Swiss Post that offers a comprehensive range of business process management services.
Pitney’s two regional subsidiaries, namely Pitney Bowes Limited and Pitney Bowes Ireland Limited, inked an agreement for an undisclosed amount with Swiss Post for this purpose. Although the detailed terms of the contract are yet to be revealed, the company has clarified that this transaction will not cover Marketing Lifecycle Services (:MLS), which will continue to be operated by Pitney itself. The transaction is expected to be complete within three months of the announcement.
After a thoughtful consideration, the management at Pitney found the held-for-sale business segment failing to complement its existing line of businesses. In addition, the management services business in the UK and Republic of Ireland was expected to perform more efficiently and effectively as part of Swiss Post Solutions. This is primarily due to the fact that the European market is the primary focus and core business area for Swiss Post Solutions, unlike that of Pitney. This acquisition will strengthen the international market presence of Swiss Post Solutions.
As per the terms of the agreement employees and consultants, who are currently working under the payroll of Pitney Bowes Management Services (:PBMS) will be transferred to the payroll of Swiss Post Solutions along with a number of PBMS facilities. Swiss Post Solutions will also takeover a list of blue-chip clients based in the UK and the Republic of Ireland from Pitney.
Pitney Bowes currently has a Zacks Rank #4 (Sell). However, some other companies that can be considered at the moment are Progressive Software Corp. (PRGS), which has a Zacks Rank #1 (Strong Buy), and Advent Software (ADVS) and Adobe Systems Inc. (ADBE) having Zacks Rank #2 (Buy) each.
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