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LONDON (Alliance News) - Consumer professional services provider Fairpoint Group PLC on Monday said trading in the first half of 2015 has been in line with its expectations, and said it has reached an agreement to acquire Colemans-CTTS LLP for GBP9 million.
The group announced that it has reached an agreement to acquire the trade and assets of Colemans-CTTS LLP, CT Support Services Ltd and the entire ordinary share capital of Holiday TravelWatch Ltd.
Fairpoint will pay GBP9 million, which will include a the payment of GBP8 million in cash and a further GBP1 million through the issue of 755,516 ordinary shares at an effective price of 132 pence per ordinary share at completion. Fairpoint shares were trading up 3.3% to 136.9154 pence on the news.
Colemans is a provider of consumer-focused legal services. In its financial year ended April 30, 2015 Colemans generated a pretax profit of GBP2.3 million on revenue of GBP19 million.
Fairpoint will fund the acquisition from its existing financial resources, comprising net cash balances and current financing facilities.
Fairpoint said that Colemans' volume capabilities complement the range of services already offered by the group's legal services business, Simpson Millar LLP.
"The acquisition of Colemans is an important step in the development of the group's fast growing legal services platform. It brings particular class leading expertise in the areas of volume personal injury, conveyancing and travel services and gives strong impetus to our agenda of reshaping the group towards a broader professional services organisation," said Chief Executive Officer Chris Moat.
Fairpoint has also reported that group trading for the first half 2015 has been "materially" ahead of the same period last year and is in line with its expectations.
The group said this reflects a strong contribution from its consumer legal services business, which was established by the acquisition of Simpson Millar at the end of the first half last year.
Fairpoint also said that Individual Voluntary Arrangement business unit conditions were challenging with the volume of new IVA services in England and Wales falling by 24% in the first quarter of 2015 compared to the same period last year.
The Debt Management Plan segment revenue was broadly flat when compared to the same period last year. The group also said that its claims management activities were broadly in line with the same period last year, with good growth from in house claims management services offset by a reduction in IVA related claims activity.
"We continue to gather strong momentum in our agenda of reshaping the group towards a broader consumer professional services organisation, whilst maintaining a solid cash generative performance in debt solutions. The acquisition of Colemans provides a substantial stimulus to this objective and a platform for further progress," said Chris Moat.
By Preten Patel; pretenpatel@alliancenews.com
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