ADT.L Regulatory News (ADT)

AdEPT Telecom plc

("AdEPT" or the "Company")

Acquisition of Comms Group UK Limited

The Board of AdEPT, one of the UK's leading independent providers of unified telecommunications solutions, today announces it has signed an agreement with effect from 1 May 2016 to acquire the entire issued share capital of Comms Group UK Limited ("Comms Group"), a well-established UK based specialist provider of unified communications, Avaya IP telephony, hosted IP solutions, IT and managed services.

Acquisition highlights:

· Initial consideration of £3.5m plus the surplus cash balance of Comms Group at completion

· Expected to be immediately earnings enhancing

· Long term relationships with SME customers

· Highly complementary product set

· Asset-light strategy

· Highly experienced senior management team to remain with Comms Group

Strategic rationale

Comms Group offers its clients the delivery of unified communications and managed service solutions specialising in the Avaya IP Office product, which is highly complementary to the existing specialism of AdEPT's Fleet office in the Avaya Aura product. The addition of a skilled team of Avaya IP Office experts, together with an experienced IT Installation and Support team, extends AdEPT's capability and enables it to address the whole market from small through to very large enterprise customers.

AdEPT and Comms Group have each adopted capital asset-light strategies and are dedicated to offering a full suite of flexible data and unified communication solutions.

Information on Comms Group

Comms Group was established in June 2008 by Matt Tarry and Paul Simmons. The company employs 25 people at its Northampton offices and is accredited by Avaya, Cisco and Gamma, supporting customers across the UK. Clients range from major, well known organisations to regional and local businesses, service organisations, entrepreneurs and online businesses in the public and private sectors.

Comms Group offers particular expertise in the provision, support and maintenance of Avaya IP Office product. Comms Group is recognised as a Partner in Customer Excellence by Avaya, its engineering team having achieved SME Expert status together with outstanding independent Customer Satisfaction survey results. In addition, Comms Group is a market leading provider of new and refurbished telecom hardware, providing a supply channel for customers to purchase new and high quality pre-owned equipment at an attractive price point backed up by a comprehensive warranty. At its Northampton offices, Comms Group holds stock from leading manufacturers including Avaya, Mitel, Cisco, Plantronics and Polycom which is used to fulfill direct and online sales orders.

Comms Group has an experienced team of IT professionals which are accredited with Microsoft, Cisco, GFI and Fujitsu in relation to IT services. It provides installation, maintenance and support for customer of all sizes, from a single PC to a virtual cluster, offering pro-active services which allow remote monitoring of customers IT equipment and remotely managed anti-virus software and mail services.

Comms Group will retain its current presence and customer service operation in Northampton. The vendors of Comms Group are to be retained in their current roles within the business for a period of at least 12 months post-completion.

The last filed accounts of Comms Group for the year ended 31 March 2015 reported revenue, operating profit and profit before tax of £3.3 million, £0.5 million and £0.4m respectively. Capital expenditure in the year ended 31 March 2015 was insignificant. Net and gross assets at that date were £1.2 million and £1.8 million respectively.

The trading performance of Comms Group for the year ended 31 March 2016 was ahead of the historic results with the unaudited management accounts of Comms Group showing revenue and operating profit of approximately £3.7 million and £0.8 million respectively.

Consideration

Initial consideration of £3.5 million plus the surplus cash balance of Comms Group at completion is payable in cash. Further consideration of up to a maximum of £3.5 million in cash is payable dependent upon the trading performance of Comms Group post-completion. The total consideration will be funded out of AdEPT's existing bank facilities provided by Barclays.

Ian Fishwick, Chief Executive of AdEPT, commented:

"We are delighted to have acquired such a high quality and profitable business with a strong committed management team. Comms Group is an excellent fit because, like AdEPT, it is asset-light, complements and builds upon AdEPT's existing expertise and skills, particularly within the Avaya product set, and further extends its offering in the unified communications space through the addition of IT services. Following the acquisition, AdEPT is now in a position to provide a complete unified communications offering which can address the whole of the market, from small customers right through to very large enterprise clients. Comms Group has a well-developed customer base with long term relationships across a range of customers. The acquisition is expected to be earnings enhancing from completion."

For further information on AdEPT please visit www.adept-telecom.co.uk or contact:

About AdEPT Telecom plc:

AdEPT Telecom plc is one of the UK's leading independent providers of voice and data telecommunications solutions. The Company provides a complete communications portfolio of fixed line calls, line rental, mobile, VoIP, equipment installation, managed services, IT, Wi-Fi, hardware and data connectivity products. AdEPT's tailored services are used by thousands of businesses and residential customers across the UK and are brought together through the strategic relationships with tier-1 suppliers such as BT Openreach, Vodafone, Virgin Media and Avaya.

AdEPT is listed on the London Stock Exchange (Ticker: ADT). For further information please visit: www.adept-telecom.co.uk