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(Sharecast News) - Technology services group the Panoply Holdings announced the acquisition of the entire issued share capital of Ameo Professional Services on Wednesday, which it described as a consultancy specialising in delivering business change, with a strong focus on the public sector.
The AIM-traded firm said Ameo had been working with businesses for more than 10 years, seeking to deliver "long-lasting, cost-effective" change across a range of areas, from financial reporting and process design to digital innovation.
Public sector work was expected to represent over 90% of revenues for the current financial year and, since being formed, Ameo had worked with more than 100 clients.
Ameo's ethos was to seek to work as a partner with its clients in order to develop sustainable solutions and improve the skills of its clients' teams, the Panoply said.
Its board said it believed the acquisition would bring additional and complementary capabilities to the group's public sector offering, as well as extending its reach in the key market.
The strategy and change delivery capability of Ameo, along with the organisational and service design capability of FutureGov, and the backing of the Panoply's technology businesses, would provide a basis for targeting and winning increasingly large digital transformation projects in the UK public sector.
Ameo is a debt free, cash generative and cash positive business, with the Panoply reporting that In the year ended 30 October, it had unaudited revenues of ?6.9m, and a normalised profit before tax of ?1.0m.
The Panoply said it was paying an effective purchase price of ?7.0m for the acquisition, to be satisfied via ?2.2m in cash and the issue of 5,853,658 new ordinary shares.
In addition, Ameo had cash in excess of normalised working capital requirements, and so an additional cash payment of ?1.3m would also be paid to the vendors at completion, above the ?7.0m.
As at 10 March 2020, assuming all payments in connection with the acquisition had been made, the group retained cash reserves of around ?4m and a net debt position of ?1m.
"Our focus is to deliver positive, sustainable change in the UK public sector and Ameo's stellar track record of work in central and local government, healthcare and higher education broadens our capability to achieve this goal for our clients," said chief executive officer Neal Gandhi.
"Ultimately, this acquisition increases our relevance and puts us in a stronger position to target and win larger, more strategic engagements at the heart of the UK public sector.
"With this acquisition, public services revenues now account for approximately 70% on a proforma basis, giving us additional scale in the sector and adding to the breadth of skills that we can now offer clients."
Gandhi said the public sector needed to continue its "digital transformation journey" with urgency, encouraging staff to embrace modern ways of working and speeding up the adoption of cloud platforms.
"As an agile native, cloud only organisation, the Panoply is able to cater to this need and the addition of Ameo to our group will support us in addressing this pressing demand.
"Together we look forward to leading the way for our clients across public, not for profit and commercial sectors."
31 Mar 2023 13:14
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