LONDON (ShareCast) - (Sharecast News) - Outsourcer Capita has agreed to sell its Education Software Solutions business to Tiger UK, a newly-formed company established by funds advised by Montagu Private Equity.
Capita announced earlier this year that it was looking to sell ESS, which is a standalone provider of management information system and related software for the education sector.

As part of the deal, Montagu has also agreed to invest in ParentPay, a provider of education technology. Following successful completion of both investments, ESS will become part of the ParentPay Group, Capita said.

Montagu will pay £298m on completion, which is expected early next year. An additional £45m will be paid once Montagu's agreed investment in ParentPay has achieved regulatory approvals.

Proceeds from the transaction will be used to strengthen Capita's balance sheet and £50m will be used to replace the remaining value of an asset-backed financing agreement, relating to intellectual property developed by ESS, which was entered into in 2012 with the Capita pension scheme.

Chief executive Jon Lewis said: "We are pleased to have agreed the sale of ESS to Montagu Private Equity after a comprehensive auction process.

"ESS is a business that Capita originally bought for £10m so we have created significant value over 25 years of ownership."

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