EXHIBIT 99.1
------------
HEIDRICK & STRUGGLES SIGNS DEFINITIVE AGREEMENT TO ACQUIRE
SUBSTANTIALLY ALL OF THE ASSETS OF HIGHLAND PARTNERS' EXECUTIVE
SEARCH OPERATIONS
CHICAGO, Sept. 18 /PRNewswire-FirstCall/ -- Heidrick & Struggles
International, Inc. (Nasdaq: HSII), the world's premier executive
search and leadership consulting firm, today announced the signing of
a definitive agreement to acquire substantially all of the assets of
Highland Partners, a leading retained executive search boutique and a
division of Hudson Highland Group, Inc. (Nasdaq: HHGP).
"The acquisition of Highland Partners, with annualized revenue in
excess of $55 million, is a highly strategic fit for Heidrick &
Struggles," said Kevin Kelly, Chief Executive Officer of Heidrick &
Struggles. "The addition of Highland Partners enhances our scale and
competitive position in the US, UK, Canada and Australia. It also
provides additional expertise in new areas of the financial services
sector, significantly adds to our Life Sciences industry group
practice and allows us to scale our business more quickly in order to
maximize the operating leverage inherent in our business model. In
addition, we see a number of synergies in combining the businesses
that will provide further upside to our ability to bring value to
shareholders."
Heidrick & Struggles will acquire Highland Partners' business through
an asset purchase funded from existing cash for $36.6 million in
initial consideration to Hudson Highland Group. Hudson Highland Group
will also be eligible to receive additional payments through 2008
based on certain performance metrics of the acquired business, which
could increase the total purchase price to a maximum of $51.6 million.
The acquisition is expected to close within 30 days, subject to a
minimum number of Highland Partners consultants agreeing to join
Heidrick & Struggles as well as other customary closing conditions. No
regulatory approvals are required. Following closing, Highland
Partners will be integrated into Heidrick & Struggles' operations.
Not including the effect of this acquisition, Heidrick & Struggles
reiterates its 2006 annual guidance for net revenue of between $445
million and $465 million, with a full-year operating margin, excluding
any changes to estimates in restructuring reserves, of approximately
12 percent. The Company believes that this transaction will be
slightly dilutive to earnings and cash flow for the full year 2006,
but is expected to be accretive to earnings in 2007. The Company plans
to update its 2006 annual guidance for net revenue and operating
margin to reflect the acquisition when it releases financial results
for its third quarter ended September 30, 2006, currently scheduled
for October 31, 2006.
"This is a rare opportunity to add a leading retained executive search
business to our operations, and we believe that clients, employees and
shareholders all stand to benefit," said Kelly. "The addition of
Highland Partners' talent, as we welcome some of this industry's
finest search consultants to our firm, will allow us to expand service
offerings to both of our client lists. Of particular importance is our
commitment to providing Highland Partners' clients with a seamless
transition, maintaining the quality of counsel, level of trust and
client service they have come to expect. Our employees will have the
opportunity to work for one of the largest retained search firms in
the world. And finally, we believe that the revenue generating
opportunities resulting from this transaction, combined with our
financial discipline and continued focus on improving operating
margins, increase our prospects for success and value creation."
About Heidrick & Struggles International, Inc.
Heidrick & Struggles International, Inc. is the world's premier
provider of senior-level executive search and leadership consulting
services, including talent management, board building, executive on-
boarding and M&A effectiveness. For more than 50 years, we have
focused on quality service and built strong leadership teams through
our relationships with clients and individuals worldwide. Today,
Heidrick & Struggles leadership experts operate from principal
business centers in North America, Latin America, Europe and Asia
Pacific. For more information about Heidrick & Struggles, please visit
http://www.heidrick.com.
About Highland Partners
Highland Partners is a leading global retained executive search
business, specializing in recruiting at the executive level, including
board directors. The firm is organized along both industry and
geographic lines, allowing it to offer clients exclusive access to an
international talent base. Highland Partners is a division of Hudson
Highland Group, Inc., a leading professional staffing, retained
executive search and talent management solutions provider. More
information about Hudson Highland Group can be found at
http://www.hudsonhighlandgroup.com .
Forward-Looking Statements
This press release contains forward-looking statements. The forward-
looking statements are based on current expectations, estimates,
forecasts and projections about the industry in which we operate and
management's beliefs and assumptions. Forward-looking statements may
be identified by the use of words such as "expects," "anticipates,"
"intends," "plans," "believes," "seeks," "estimates," "projects,"
"forecasts," and similar expressions. Forward-looking statements are
not guarantees of future performance and involve certain known and
unknown risks, uncertainties and assumptions that are difficult to
predict. Actual outcomes and results may differ materially from what
is expressed, forecasted or implied in the forward-looking statements.
Factors that may affect the outcome of the forward-looking statements
include, among other things: our ability to attract and retain
qualified executive search consultants; the condition of the economies
in the United States, Europe, or elsewhere; social or political
instability in markets where we operate; the impact of foreign
currency exchange rate fluctuations; price competition; the ability to
forecast, on a quarterly basis, variable compensation accruals that
ultimately are determined based on the achievement of annual results;
an inability to achieve the planned cost savings from our cost-
reduction initiatives; an inability to sublease or assign unused
office space; our ability to realize our tax loss carryforwards; the
timing of any deferred tax asset valuation allowance reversals; the
mix of profit and loss by country; an impairment of our goodwill and
other intangible assets; and delays in the development and/or
implementation of new technology and systems. Our reports filed with
the U.S. Securities and Exchange Commission also include information
on factors that may affect the outcome of forward-looking statements.
We undertake no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise.
"Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995: Statements in this press release regarding Heidrick &
Struggles International, Inc.'s business which are not historical
facts are "forward-looking statements" that involve risks and
uncertainties. For a discussion of such risks and uncertainties, which
could cause actual results to differ from those contained in the
forward-looking statements, see "Risk Factors" in the Company's Annual
Report or Form 10-K for the most recently ended fiscal year.