Compass Diversified Holdings Announces Sale of Staffmark Holdings

Compass Diversified Holdings

announced today that it has simultaneously entered into a definitive agreement to sell and consummated the sale of its majority owned subsidiary, Staffmark Holdings, Inc. ("Staffmark"), to a subsidiary of Japan-based Recruit Co., Ltd., for a total enterprise value of $295 million. The transaction is subject to customary escrow and working capital provisions. After these adjustments, as well as for an allocation to Staffmark's non-controlling shareholders and the payment of all of the transaction expenses, CODI received approximately $220 million of total proceeds from the sale at closing. This amount was in respect of its debt and equity interests in Staffmark and the payment of accrued interest and fees. In addition, the transaction also increases availability under CODI's revolving credit facility by approximately $67 million, as letters of credit guaranteeing payments for Staffmark's workers compensation liability are no longer required to be provided by CODI. The Company anticipates recording a gain on the sale of Staffmark ranging between $75 million and $90 million for the quarter ended December 31, 2011.