Capita, a UK-based provider of business process outsourcing solutions and professional support services, issued a profit warning earlier this week and announced that it plans to raise £700m from investors.

However, a company spokesperson assured that operations at its Resourcing division will be ‘business as usual’.

In an announcement, Capita said its profits would be 30% lower than it had previously estimated. It stated that it would begin a two-year non-core disposal programme. Dividend was also suspended until the company generates sustainable free cash flow.

Capita Resourcing, which is not part of the group’s core outsourcing business is said to not be affected. A spokesperson added that further announcements will be made in the future regarding the company’s other divisions.

The announcement caused a selloff that saw the company’s shares fall by more than 47% on the day, wiping £1.1 billion off the company’s stock market value. The announcement prompted comparisons to outsourcing giant Carillion, which entered liquidation two weeks ago.

Jonathan Lewis, who was appointed as CEO last year, said the company was “too complex” and said that “significant change is required for Capita’s next stage of development.”

“We are now too widely spread across multiple markets and services, making it more challenging to maintain a competitive advantage in every business and to deliver world class services to our clients every time,” Lewis said.

“An immediate priority is to strengthen the balance sheet through a combination of cost savings, non-core disposals and new equity. My initial review of our cost base highlights that over the next few years there is significant scope for cost efficiencies across a number of areas but also the need to spend more where there has been underinvestment. We have identified a small number of quality businesses that do not fit with our core skills for which there will be better owners and a process to maximise value will commence shortly,” Lewis said.