Capita buys Tribal divisions

11th Apr 2011 10:43

Outsourcing giant Capita has conditionally agreed to acquire public sector service provider Tribal's health and government divisions for £15.8m.Capita says the acquisition, which must be approved by Tribal's shareholders, will add new capabilities to its health and consulting businesses."The government consulting acquisition will strengthen our proposition for service delivery and technical support across central and local government, including policing, justice and housing," said Capita chief executive Paul Pindar."In addition, Tribal's health expertise fits with our strategic goal to provide support services to GP commissioning consortia."Following the sale, Tribal will be focused on the education and training markets."The board believes that opportunities exist to grow the revenues of the government and health businesses but that both require significant investment over a period of time in order to enable them to generate acceptable levels of profitability," Tribal chairman John Ormerod said."In these circumstances, the directors have decided that it would be appropriate for Tribal to consider a sale of the government and health businesses in order to create a group focused on the education and training markets and with significantly reduced levels of financial leverage."Shares in Tribal jumped after the announcement.