USG Jumps to Highest Level in 11 Months on Asset SalesFred Pals
USG People NV, the staffing company that derives a third of its revenue from the Netherlands, rose to its highest level in 11 months after it agreed to sell employment operations in six other European nations.
USG People jumped as much as 4.6 percent to 6.85 euros, the highest intraday price since May 8, and climbed 3.1 percent to
6.75 euros at 11:38 a.m. in Amsterdam, to give the Almere, Netherlands-based company a market value of 538.1 million euros ($689 million).
Randstad Holding NV, the biggest Dutch staffing company, agreed to buy USG People’s operations in Spain, Italy, Poland, Switzerland, Luxembourg and Austria, the Diemen-based company said in a statement today. USG People said it will receive 20 million euros from the sale which will transfer about 800 employees and 189 outlets to Randstad.
“USG will reduce pouring precious management time and effort into strategically valueless businesses,” Gert Steens, an Amsterdam-based analyst at SNS Securities, said in a note to investors today. “USG’s mix gets a cosmetic boost as the lowest gross margin activities will be taken out,” said Steens who has a buy rating on the stock.
USG People’s shares fell 3 percent in the year through yesterday, compared with a 19 percent gain for Randstad. Today’s divestment follows the sale of USG People’s energy unit in February to private equity firm Rabo Capital for 80 million euros. The company cut costs by 70 million euros last year.