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Pitney Bowes Takes Steps to Spin Off Capital Services Business

Press release from the issuing company

STAMFORD, Conn., Dec. 16 -- The Board of Directors of Pitney Bowes Inc. today approved a plan to pursue a sponsored spin-off of its Capital Services external financing business. The new entity would be an independent publicly-traded company consisting of most of the assets in its Capital Services segment, including assets related to Imagistics International, Inc. The company has entered into negotiations with a party interested in investing in the new entity. The decision to move forward with the spin-off will be contingent upon reaching agreement on terms with an investor, prevailing market conditions at the time of the proposed spin-off, regulatory review and the receipt of a favorable ruling from the Internal Revenue Service that the spin-off would be tax free. Michael J. Critelli, Chairman and CEO of Pitney Bowes Inc. said, "In January, 2003 we announced our decision to stop active origination of long- term external financing transactions and to liquidate our $2 billion-plus portfolio over time. Our objective was to reduce the risks associated with complex, long-term financing transactions, enhance our financial flexibility and sharpen our focus on our core businesses. "In looking at our options for maximizing the value of both Pitney Bowes and Capital Services, we decided that both entities had the potential to benefit from a sponsored spin-off under the right conditions." Pitney Bowes Capital Services, headquartered in Shelton, Conn., provides a range of custom-tailored external commercial financing solutions for companies of all sizes. With a 25-year heritage and assets exceeding $2 billion, Capital Services has offered an array of quality financing, leasing and advisory services in three areas: Capital Equipment; Vendor Financing; and Commercial Real Estate through its PREFCO business unit. Capital Services' success is predicated on its ability to build profitable, long-term relationships with both customers and business partners. Critelli concluded, "As separate entities, Pitney Bowes and Capital Services could leverage our respective core strengths, sharpen the focus on the growth opportunities in our designated markets, and maximize speed and responsiveness to changing customer and competitive conditions."

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