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Leaving aside the apparent problems and management distractions in its IT services division (see Quartermaine leaves Capita), Capita's CE Paul Pindar is back focusing his attention on the company's true knitting, IT-enabled business process services.
Capita is acquiring business travel and conference booking agent Expotel for £16m on the usual cash-free, debt-free terms. Capita is paying 1x sales for Expotel, which made revenue of £16.3m in the year to 31 October, 2011, and a pro forma operating profit of £3.2m (a healthy 20% margin).
Expotel operates out of three offices in Stockport (HQ), Glasgow and Leeds, and counts the likes of National Grid, Virgin Media, the Scottish government and BP among its customers. Expotel offers its services via customer service agents, or via a self-service booking portal. It also recently launched a procurement platform Expotel Trade, through which partners can get direct access to over 70,000 hotels and venues, no doubt with the aim of driving down cost for their client. Capita will be getting its hands on Expotel's in house loyalty programme. Loyalty BP services is another growth area of the market, where rivals like Atos and Arvato are making significant inroads.
This is the second business travel provider Capita has acquired, the previous one being BSI Holdings (BSI) in December 2010, which provides travel services for Marks and Spencer, Easyjet and the Crown Prosecution Service (see here). Following this deal, Capita will now have 900 people providing business travel services across 10 locations in the UK. Pindar is optimistic about exploiting opportunities in the public sector in particular, where there should be plenty of potential to drive out cost from travel and venue hiring.