KBT4 Jul 2011 08:54
Acquisition of Retail Customer Base
K3, which supplies enterprise resource planning ("ERP") software, hosting and managed services to the supply chain industry, is pleased to announce the acquisition of the Retail Merchandising Division of Azurri Computer Solutions Ltd ("Azurri Retail"). The consideration for the acquisition is £1.0m, payable in cash on completion. Further consideration of up to £0.5m is payable dependent on increases in gross margin generated by Azurri Retailover the next two years.
For the year to December 2010, Azurri Retail generated sales of £1.0m and an underlying profit of £0.4m. Over £0.6m of 2010 revenues were recurring. Azurri Retail's customer base comprises a number of major retailers, including Matalan, JJB Sports, Littlewoods, Holland & Barratt and the National Trust.
Azurri Retail represents a highly complementary fit with K3's existing retail software operations, adding further specialist skills, and it will be readily integrated into the Group. Its acquisition is in line with K3's strategy to build recurring revenues and acquire profitable user bases with significant cross-selling opportunities, in particular for its hosting and managed services offering.