Capita has agreed to sell its standalone software business, Capita One, to Orchard Information Systems in a deal valued at £207m.

Orchard Information Systems, a wholly-owned subsidiary of MRI Software, will purchase Capita One on a cash-free, debt-free basis for a fee of around £200m.

The disposal will result in Capita receiving expected gross cash proceeds of approximately £207m upon completion, with the group also expecting to receive a cash dividend of £4.8m from Capita One before completion.

Capita One provides local authorities, local education authorities and housing associations with revenues and benefits, social housing management and education management software.

Capita has previously stated that standalone software activities, including the Capita One business, are part of the group’s activities that are being “managed for value”.

CEO, Adolfo Hernandez, said: “Capita’s strategy is to become a more focused company, prioritising businesses where we can deliver material opportunities in the future, with greater simplification and cost reduction.

“Capita One is a high-quality business that has performed exceptionally well. Under its new owner, it is well positioned to benefit from investment in its strategic growth.

“We remain committed to the local public service market but want to see Capita One be set up for continued success with an owner that can deliver the investment it needs.”

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