RNS7 Mar 2019 07:29
07 March 2019
Water Intelligence plc
("WATR" or the "Company")
Reacquisition of South Atlanta Franchise
Timing of 2018 Trading and Corporate Updates
Water Intelligence plc (AIM: WATR.L), a leading multinational provider of precision, minimally-invasive leak detection and remediation solutions for both potable and non-potable water is pleased to announce the reacquisition of its American Leak Detection South Atlanta franchise for $425,000.
The reacquisition is strategic for various reasons, all beneficial for reinforcing the Company's growth trajectory and more fully realizing its plan to unlock equity value as previously discussed in our annual reports.
First, South Atlanta is a central area for creating a regional corporate presence to help accelerate development of southeastern franchises, including a couple of large franchises that could still accelerate their growth given the size of regional market. Today's reacquisition follows January's reacquisition of Ontario, Canada to create a similar regional corporate presence in northeast Canada and upstate New York.
Second, the franchise achieved approximately $320,000 of sales during 2018. However, with corporate financial support it is expected that this territory can grow much faster reinforcing the Company's 2019 plan.
Third, there is significant undeveloped territory in southern Georgia as part of the franchise. In terms of the evolution of corporate strategy, now that Water Intelligence has had significant experience in growing corporate locations as well as franchise locations, more options are available to unlock value. Water Intelligence has the opportunity not only to accelerate growth in the developed part of the South Atlanta territory but also to now resell the undeveloped territory as part of a new right-sized franchise. Given the increasing equity value of franchises, especially because of the additional support from established regional corporate hubs, Water Intelligence already has received expressions of interest to purchase any new territory made available.
Finally, the current franchise owner has agreed to stay with American Leak Detection and open a new corporate location given his experience. Water Intelligence is currently reviewing new locations to push further market capture. Much like the Ontario transaction, the Company plans to grow from within and retain experienced managers after reacquisition...
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