Proposed sale

Pro Global Insurance Solutions plc

Proposed sale

Introduction

Pro Global Insurance Solutions plc ("the Company") announces that it has conditionally agreed to sell the shares in its outsourcing and consulting businesses ("Pro Services") for a total consideration of £8.3 million (the "Sale") to a newly formed company owned by clients of Acuity Investments LLP ("NewCo"). Following the Sale, the Company's only trading activity will be through its 30% investment in its associate Asta Capital Ltd. ("Asta") which owns a number of companies including Asta Managing Agency Limited, the leading third party managing agent at Lloyd's.

The Sale constitutes a fundamental change of business under Rule 15 of the AIM Rules. Accordingly, the Sale is conditional upon approval of the Company's shareholders ("Shareholders") in a general meeting.

Information on Pro Services

Pro Services consists of the outsourcing and consulting businesses of the Company. It provides Legacy Solutions, Technical Outsourcing, Operational Consulting and Risk Audit & Compliance services to the insurance and reinsurance industry.

The recent financial performance of Pro Services was set out in the Company's Interim Report and Accounts for the half-year ending 30 June 2016 and the Final Accounts for the full-year ending 31 December 2015. The profit attributable to Pro Services for the full-year ended 31st December 2015 was £0.9 million and for the half-year ended 30th June 2016 was £0.2 million.

The pro forma net asset value of Pro Services, as included in the consolidated balance sheet at 30 June 2016 was £7.6 million. Goodwill amounting to £5.1m included within the consolidated total net assets of the Company and its subsidiaries relates entirely to Pro Services and will be written off.

Information on Acuity

Acuity Investments LLP is a private equity firm, founded by two principals, Adam Barron and Toby Franklin, with a long track record of investing in the insurance and specialty lending sectors, including a very successful investment in Canopius at Lloyd's. Acuity aims to invest in strong businesses, such as Pro Services, with outstanding management and strong market positions in well-established areas of financial services. Acuity has a long term perspective for their investments, to allow companies to grow, invest and develop over time. Acuity will aim to support Pro Services with further investment to pursue its strategic objectives.

The Sale

Under the terms of the Sale, NewCo will pay cash consideration of £8.3 million to acquire 100% of the shares of five wholly owned subsidiaries of the Company: Pro Insurance Solutions Limited; Pro IS, Inc.; Stripe Global Services Limited; Chiltington Holdings Limited; and Chiltington International Holding GmbH and various subsidiaries of these companies. This amount is subject to adjustment for movement in working capital based on the balance sheet as at 30 September 2016. The impact of the Sale on the Company's balance sheet as at 30 June 2016 is a reduction of £4.4 million:

The purchase price will be funded by clients of Acuity Investments LLP. The consideration will be satisfied in cash only.

The Sale is conditional upon Shareholder, Financial Conduct Authority and other regulatory approvals.

The Company's operations following the Sale

The Company has considered the capital investment requirements of Pro Services and has decided that focussing on Asta and selling Pro Services is in the best interests of Shareholders. The Company will use materially all of the proceeds of the Sale to pay down outstanding debt.

Asta

Following the Sale, the Company will focus on supporting the growth of Asta, the leading third party managing agency at Lloyd's. Asta has a very successful core business which continues to generate strong profitability and cash flow

Pro Services following the Sale

This transaction will enable Pro Services to have the investment necessary to continue its "Client First" strategy with the same single-minded commitment to client service. There are no planned changes to the Pro Services management and teams. In addition, the Sale will provide Pro Services with long term financial stability and eliminates all long-term debt.

Board

It is expected that Artur Niemczewski and Andrew Donnelly, the Company's Chief Executive and Finance director respectively, will transfer to NewCo with Pro Services following completion of the Disposal or shortly thereafter.

Change of Name

The Company expects, following completion of the Sale, to change its name. The new name has not been selected. The change of name will require shareholder approval by special resolution.

General Meeting

The completion of the Sale and change of name of the Company is conditional inter alia upon Shareholder approvals at a general meeting of the Company. A shareholder circular will be sent to Shareholders as soon as possible setting out a notice convening a general meeting and the resolutions to be voted on. It is anticipated that the Shareholders' meeting will be convened in February 2017.

Tim Carroll, Chairman of the Company, said. "Asta has performed very well since its acquisition in 2011, and we look forward to focussing on growing Asta following the sale of Pro Services. We wish the employees of Pro Services every success in the future and are grateful for the tremendous progress they have made over the last two years to make Pro Services a great standalone business."

Artur Niemczewski, CEO of the Company, said, "Pro Services' priority in 2017 is the continued implementation of its "Client First" strategy with the same single-minded commitment to client service. Core to this strategy is the provision of market leading solutions to the industry, and the acquisition by Acuity will provide Pro Services with the investment necessary to pursue this objective. The Pro Services team is very excited about the prospects, long term stability and financial strength this transaction will bring to us."

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