Takes full ownership of Fondsdepot Bank

Xchanging plc

Takes full ownership of Fondsdepot Bank GmbH

Xchanging plc ("Xchanging"), the business process, procurement and technology services provider, today announces it has signed an agreement with its Enterprise Partner, Allianz Global Investors Europe GmbH("AllianzGI") triggering the exercise of a put option held by AllianzGI that will give Xchanging 100% ownership of the investment account administration business Fondsdepot Bank GmbH ("FdB").

Further, as part of this transaction, all customer accounts administered by FdB, but contracted with AllianzGI under a service contract due to expire in October 2015, will be transferred to FdB ownership, in June 2015. Xchanging is to provide an updated customer portal in accordance with agreed specifications, and adjustments are being made to the ongoing fee arrangements with AllianzGI.

Xchanging is paying AllianzGI €13.6 million in cash on exercise of the put option - the amount originally agreed when the FdB joint venture was created. In addition, FdB will make a one-off cash payment of €4m into a trust in connection with the existing pension entitlements owed to FdB employees.

The consideration will be satisfied by drawing under Xchanging's revolving credit facility. Following the transaction, a €20.0 million letter of credit, issued in favour of AllianzGI, will be terminated with the notional amount being added back to the debt facility headroom. The transaction is expected to have an overall neutral impact on Xchanging's profitability.

Xchanging reported in its 13 May 2014 Interim Management Statement that it was in exclusive discussions with AllianzGI regarding ownership of FdB, the German investment account administration business owned jointly by Xchanging and AllianzGI. The agreement announced today completes this process and draws another Xchanging Enterprise Partnership to a close, further simplifying Xchanging's business.

Xchanging is investing in the development of FdB, introducing robotic automation to increase efficiency and reduce cost, and extending the product range to increase its market facing presence and reinforce its competitive position. Following this transaction, Xchanging will have over one million investment accounts under evergreen end-customer contracts. This strengthens FdB's position as one of the leading independent investment account administration platforms in Germany.

This transaction falls within LR 11.1.10R of the Listing Rules and Xchanging considers it to be fair and reasonable as far as shareholders of the company are concerned.

Commenting on today's announcement, Xchanging's Chief Executive, Ken Lever, said: "We are investing in Fondsdepot Bank to improve its business performance and enhance its position and growth potential in the market. Gaining full ownership simplifies the business structure and, through the account transfer, we are delighted to extend and strengthen Fondsdepot Bank's relationship with AllianzGI into the foreseeable future".

Michael Peters, AllianzGI's Chief Operating Officer Europe, said "We are pleased to renew and extend our commitment to Xchanging and Fondsdepot Bank. We are excited about the development of the platform and the investments in FdB's technology, which will improve customer experience and thus be supportive to our growth strategy."

Enquiries

Xchanging plc Tel: +44 (0) 203 604 6999

David Bauernfeind, Chief Financial Officer

Alexandra Hockenhull, Director of Corporate Communications

and Investor Relations

Maitland Tel: +44 (0) 207 379 5151

Peter Ogden

Martin Barrow

www.xchanging.com

@XchangingGroup

Linkedin/company/xchanging

Cautionary Statement: 

This announcement contains forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could, is confident, or other words of similar meaning. In particular, any statements regarding Xchanging's strategy, dividend policy and other future events or prospects are forward-looking statements.  Undue reliance should not be placed on any such statements because they speak only as at the date of this announcement and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors (that could cause actual results, and Xchanging's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.

These forward-looking statements are not guarantees of future performance and there are a number of factors (many of which are outside of Xchanging's control) which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among these factors are: increased competition, the loss of or damage to one or more key customer relationships, changes to customer ordering patterns, delays in obtaining customer approval or price level changes, the failure of one or more key suppliers, the outcome of business or industry restructuring, the outcome of any litigation, changes in economic conditions, currency fluctuations, changes in interest and tax rates, changes in raw material or energy market prices, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the key timing and success of future acquisition opportunities or major investment projects.

Save for those forward-looking statements required by the Listing Rules, the Disclosure and Transparency Rules and/or the Prospectus Rules, Xchanging undertakes no obligation to update these forward-looking statements, and will not publicly release any revisions it may make to these forward-looking statements that may result from events or circumstances arising after the date of this announcements. Xchanging therefore will comply with its obligations to publish updated information as required by law or by any regulatory authority but assumes no further obligation to publish any additional information.