TIDMBEG
RNS Number : 8436X
Begbies Traynor Group PLC
10 January 2022
10 January 2022
Begbies Traynor Group plc
Acquisition
Begbies Traynor Group plc (the "group"), the business recovery,
financial advisory and property services consultancy, today
announces that it has completed the acquisition of Daniells
Harrison Surveyors LLP ("Daniells Harrison").
Daniells Harrison is a firm of chartered surveyors employing 27
staff who will integrate with Eddisons, the group's property
advisory and transactional services division. The team provide
valuation and property consultancy services to a wide range of
clients across the south coast of England from offices in Fareham,
the Isle of Wight, Bournemouth and Hailsham.
In its financial year ended 31 March 2021, Daniells Harrison
generated revenue of GBP2.1m (unaudited) and normalised pre-tax
profits of GBP0.4m (when reported on the same basis as the group).
Trading has been maintained at these levels in the current
financial year to date. It had net assets of GBP0.5m (including
GBP0.3m cash) as at 31 March 2021.
Reasons for and benefits of the acquisition
The group's strategy is to increase the scale and quality of its
businesses both organically and through value-accretive
acquisitions, enabling increased shareholder value through the
delivery of strong, sustainable financial performance.
Our strategy in property services is to enhance and broaden our
service offerings and geographical coverage. Since the creation of
the division through the acquisition of Eddisons in December 2014,
the group has built a strong track record of acquisitions that have
met these criteria. This strategy has increased the scale of the
division from annual revenue of cGBP13m at inception to a current
run rate of cGBP26m, together with strong and growing
profitability.
The acquisition is in line with our strategy, as the Daniells
Harrison team will extend the geographical coverage of the division
which has now broadened from its original northern base, to include
London and Eastern England as well as now the South Coast.
Principal terms of the acquisition
The acquisition is for consideration of GBP2.0m based on current
levels of financial performance, on a cash free, debt free basis,
structured as:
-- Initial consideration of GBP1m, payable GBP0.75m in cash and
through the issue of 186,651 new ordinary shares;
-- Contingent cash consideration of GBP1m subject to maintaining
financial performance in the four year period post completion.
In addition, the acquisition includes a maximum cash earn out of
GBP1.25m subject to meeting growth targets over the five year
period post completion.
This gives a maximum consideration of GBP3.25m (on a cash free
debt free basis).
The initial cash consideration will be met from the group's
existing financial resources, with significant headroom available
for further acquisitions and investment.
Application has been made to the London Stock Exchange for the
186,651 new ordinary shares to be admitted to trading on AIM. It is
expected that admission will become effective at 8.00 a.m. on 13
January 2022 following which the total number of shares in issue
and total voting rights will be 152,723,482. The group does not
hold any shares in treasury and, therefore, the above figure may be
used by shareholders as the denominator for the calculation by
which they will determine if they are required to notify their
interest in, or a change to their interest in the company.
Anthony Spencer, Director at Eddisons, commented:
"I am very pleased to welcome the Daniells Harrison team to
Eddisons, which extends our geographical coverage across the South
Coast. They are a highly experienced team with a proven track
record in delivering high quality professional advice. We continue
to seek further opportunities for expansion across the UK."
Ric Traynor, Executive Chairman of Begbies Traynor Group plc,
commented:
"The acquisition of Daniells Harrison is in line with our
strategy to develop our property advisory and transactional
services division, by increasing both its scale and market
position, as well as the scope of its service offering and
geographical coverage. Daniells Harrison has excellent
relationships with a broad range of clients which have been
developed over many years and we are very much looking forward to
working with them."
Enquiries please contact:
Begbies Traynor Group plc 0161 837 1700
Ric Traynor - Executive Chairman
Nick Taylor - Group Finance Director
Canaccord Genuity Limited 020 7523 8350
(Nominated Adviser and Joint Broker)
Adam James / Patrick Dolaghan
Shore Capital 020 7408 4090
(Joint Broker)
Malachy McEntyre / Mark Percy / Anita Ghanekar / James
Thomas
MHP Communications 020 3128 8572
Reg Hoare / Katie Hunt / Florence Mayo begbies@mhpc.com
Information on Begbies Traynor Group can be accessed via the
Group's website at
www.begbies-traynorgroup.com/investor-relations
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END
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