Cordia Corp., an Orlando, Fla.-based provider of telecommunication and tech-enabled outsourced services, announced it has sold its remaining insurance-related operating subsidiaries, for the purchase price of $750,000 in the form of a note secured by shares of common stock of Cordia, to a group led by the current management of those subsidiaries.
Cordia also reported that it expects the transaction to generate a one-time pre-tax gain of approximately $1.5 million. In addition, in connection with the sale, Cordia entered into a licensing and software services agreement with the purchaser that has a minimum value to Cordia of approximately $250,000 over the next two years.
The insurance subsidiaries sold by Cordia are expected to report approximately $5,000,000 in annual revenue for the year ended December 31, 2002. Despite rapid growth of the last two years, the subsidiaries continued to report operating losses and negative equity and had a negative working capital deficit of approximately ($1,000,000) at December 31, 2002. Cordia believes the sale will improve its consolidated working capital position by over $1,000,000 and allow it to report positive shareholders equity after the transaction.
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