TIDMBEG
RNS Number : 2012Q
Begbies Traynor Group PLC
27 June 2022
27 June 2022
Begbies Traynor Group plc
Acquisition
Further expansion of Eddisons' regional footprint and
offering
Begbies Traynor Group plc (the "group"), the business recovery,
financial advisory and property services consultancy, today
announces that it has completed the acquisition of Budworth
Hardcastle Ltd.
Budworth Hardcastle is a firm of chartered surveyors employing
18 staff in offices in Northampton, Kettering and Peterborough. The
business will integrate with Eddisons, the group's property
division, which has existing regional offices in Bury St Edmunds,
Huntingdon, Northampton and Peterborough.
The Budworth Hardcastle team provide valuation, commercial
property agency and building consultancy services to a wide range
of regional clients, which aligns with the group's current service
offering and strengthens our regional presence.
In its financial year ended 31 August 2021, Budworth Hardcastle
generated revenue of GBP1.8m (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 GBP0.4m (including
GBP0.3 cash) as at 31 August 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, thereby delivering 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 cGBP30m, together with strong and growing
profitability.
The acquisition is in line with our strategy, as the Budworth
Hardcastle team will strengthen Eddisons' existing offering and
footprint in Eastern England, and follows the recent acquisitions
of Daniells Harrison (January 2022) and Fernie Greaves (October
2021) which augmented our south coast and Yorkshire presences.
Principal terms of the acquisition
The acquisition consideration is structured as follows, based on
current levels of financial performance and on a cash free, debt
free basis:
-- Initial consideration of GBP0.9m, payable GBP0.6m in cash and
through the issue of 206,937 new ordinary shares;
-- Contingent cash consideration of up to GBP0.9m subject to
maintaining financial performance in the three year period post
completion.
In addition, the acquisition includes a maximum cash earn out of
GBP0.6m subject to meeting growth targets over the five year period
post completion.
This gives a maximum consideration of GBP2.4m (on a cash free
debt free basis).
The 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
206,937 new ordinary shares to be admitted to trading on AIM. It is
expected that admission will become effective at 8.00 a.m. on 30
June 2022 following which the total number of shares in issue and
total voting rights will be 153,742,455. 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 Budworth Hardcastle team to
Eddisons, which extends our footprint in Eastern England. 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 Budworth Hardcastle 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. Budworth Hardcastle 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 8567
Reg Hoare / Katie Hunt / Pauline Guenot 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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June 27, 2022 02:00 ET (06:00 GMT)
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