27th Apr 2018 12:38
LONDON (Alliance News) - Management Consulting Group PLC said on Friday although it is certain it will release the remaining Kurt Salmon escrow funds, it remains uncertain as whether it will do so in the second half of 2018.
In 2015 and 2016, the consultant disposed of several of its businesses, including management consulting company Kurt Salmon in Europe.
A material aspect of this is the negotiation of the release of funds held under escrow arrangements which guarantee certain liabilities related to the disposal of Kurt Salmon to Wavestone in 2016.
The escrow funds represent GBP6.0 million of Management Consulting's cash resources of GBP16.1 million and were expected to be released in two tranches in January and July.
However, negotiations over the treatment of potential indemnification claims has led to the release of the first tranche being delayed.
As a result EUR2.0 million of the first tranche has been released to Management Consulting after an agreement on Thursday while the remaining EUR2.0 million is held in escrow until the claims are settled. The escrow arrangement for the remaining EUR4.0 million ends on July 7.
Shares in Management Consulting Group were down 2.4% at 4.00 pence on Friday.
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