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ECG deal moving ahead - contracts not included

January 25 2008
The MPS Group Inc.'s (NYSE: MPS) acquisition of Ensemble Chimes Global assets is moving forward. Doug Leeby, senior VP of MPS' Beeline, said the assets of ECG were purchased but not the customer contracts. The idea is to keep ECG's VMS operational and give clients some breathing room, Leeby said. "We're just trying to provide stability to the current customer base."

The deal is expected to close by Jan. 31. MPS will pay $8,075,000 for ECG's assets.

ECG filed for bankruptcy the day after the bankruptcy filing of its parent company, Los Angeles-based Axium International Inc. The sudden filing jolted the staffing industry, leaving customers wondering what to do next and staffing firms concerned about payments. One ECG client, Comsys IT Partners (NASD: CITP), warned investors on Thursday it was analyzing the collectibility of $1.0 million related to monies for work in progress and Comsys funds ECG was holding at the time of its bankruptcy. Spherion Corp. (NYSE: SFN) said Tuesday a large VMS that filed bankruptcy held $1 million in funds owed Spherion that may not be fully collectible.

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