Monday, August 15, 2022
Prosegur Cash announced on July 28 a merger agreement with Armaguard Group, the largest logistics and cash-in-transit (CIT) company in Australia. The proposed merger represents another milestone for Prosegur Cash as it reinforces its commitment to the Australian market and intends to ensure the continued supply of cash as a critical infrastructure and a vital part of the payments landscape in Australia. Prosegur Cash and Armaguard want to ensure that cash remains a cost-effective and safe payment option for businesses and consumers well into the future. This will mean that cash can continue to fulfil its role in protecting privacy, choice, and access to payments for all, including for vulnerable people who rely on cash, including in remote and rural Australian communities, and in times of natural disaster when networks go down, and digital payments are not available.
The transaction has been structured using the contribution by Prosegur Australia to Armaguard of 100% of the share capital of the subsidiaries of Prosegur Cash in Australia, which carry out the businesses, on a cash-free, debt-free basis, in exchange for shares of Armaguard representing 35% of the share capital of the jointly participated company. Consequently, Armaguard and Prosegur will participate in the joint company on a 65%-35% basis.
The proposed merger will enable Prosegur Cash and Armaguard to accelerate further the promotion of new products and innovation in Australia’s highly competitive payments landscape and cash logistics activities. These products span cash automation solutions, banking outsources solutions, retail payments, ATM services and operational innovation in cash solutions.
Ultimately, the proposed merger will allow Prosegur Cash and Armaguard to share costs, improve scale, optimise efficiencies and continue investing in their security and service levels to benefit Australian businesses and consumers. The merger is expected to complete before the end of the year and is subject to regulatory approvals. The impact of the transaction from an accounting perspective will depend on the progress and evolution of the business of Prosegur Australia as of this date and until the closing of the transaction. When the deal closes, Prosegur Cash will consolidate its interest in the joint company by the equity method.
Established in 1938, Armaguard has provided safe and secure cash services for major banks, retailers, and organisations for over 80 years. In 2003, Linfox Group acquired Armaguard. Since then, the company has invested heavily in creating modern end-to-end currency management solutions for its customers, promoting further research and technological advancement.
Prosegur Cash is currently a top 3 CIT business globally and number 1 in 10 countries in which it operates, including Spain, Germany, Brazil and Argentina. Prosegur Cash entered the Australian market in 2013 after acquiring Chubb Security Services, a company specialising in CIT and the ATM operations and servicing industry.