ARL.L Regulatory News (ARL)

28 Oct 2005 07:00

SMC Group Plc28 October 2005 SMC Group Plc SMC acquires DTR:UK Ltd SMC Group Plc ("SMC" or "the Company") announces that it has agreed to acquire Dempster Thrussell & Rae Limited and DTR Sheard Walshaw Limited, both trading asDTR:UK Ltd ("DTR:UK"), an architecture and design company based in Manchester, with offices in Liverpool, Leeds and Birmingham. • The total consideration is contingent upon the performance of DTR:UK and will be calculated with reference to a multiple of 3.5 times DTR:UK's profit before tax for the 12 months ended 31 December 2008. • £1.2 million is payable immediately, and will be satisfied by a cash payment of £900,000 and the issue of 412,089 shares of 0.5 pence each in the Company ("New Ordinary Shares") at a price of 72.8 pence per share. • The balance of the consideration will be paid in stages between 30 March 2006 and 1 June 2009, and will be calculated according to the future performance of DTR:UK. Ultimately, the total consideration will be satisfied by an equal mix of loan notes and shares. • For its financial year ended 31 January 2005, DTR:UK's revenue was £3.8 million and its profit before tax was £262,000. • The acquisition of DTR:UK will increase SMC's exposure to the architecture and design market in the North of England. SMC Group plc, the architecture and design business, announces the acquisition of DTR:UK Ltd, an architecture and design company based in Manchester, with offices in Liverpool, Leeds and Birmingham. The total consideration is contingent upon the future performance of DTR:UK and, subject to a minimum of £1.2 million, will be calculated with reference to a multiple of 3.5 times DTR:UK's profit before tax for the 12 months ended 31 December 2008. An initial consideration of £1.2 million is payable immediately, which will be satisfied by a cash payment of £900,000 and the issue of 412,089 shares of 0.5 pence each in the Company at a price of 72.8 pence per share. The remainder of the consideration will be paid quarterly during 2006 and thereafter annually between 1June 2007 and 1June 2009, according to the performance of DTR:UK. Ultimately, the total consideration will be split equally between loan notes and shares. Application will be made for the New Ordinary Shares to be admitted to AIM. It is expected that dealings in the New Ordinary Shares will commence on 3 November 2005. DTR:UK is a design led architectural and interior design company, operating fromoffices in Manchester, Liverpool, Leeds and Birmingham. The company works across a wide range of sectors on projects which range in size and complexity, and combines a rich blend of new management styles with commercial expertise to provide a professional architectural and interior design service. DTR:UK's strategy of maintaining a broad sector approach and wide ranges of construction value very much aligns with SMC's 'balanced approach to growth'. Clients therefore range from the University of Central Lancaster to MacDonald Hotels, Bellway Homes, Amec Developments, Pillar Properties and Countryside Properties, a mixture of regional and national developers. DTR:UK's turnover for the financial year ended 31January 2005 was £3.8m, with profit before tax of £262,000. The acquisition of DTR:UK will be the fifth transaction completed by SMC. TheSMC Group seeks to achieve geographical coverage throughout the UK. SMC'sstrategy focuses upon organic and acquisitive growth, aiming to acquireestablished companies with strong trading histories and prospects, therebygaining access to larger scale and higher margin projects such as major towncentre regeneration or large government schemes such as schools and hospitals. Commenting, SMC's Chief Executive, Stewart McColl said "We are delighted with the acquisition of DTR:UK and see this situation as a merger of like minds. DTR:UK, a comparatively young team, but the principals have worked with me and fellow directors in the past, are well known to us and are respected in our industry. They have grown their business successfully over the last 12 years and, working together with SMC will prove to be an earnings enhancing addition to the SMC stable". Andrew Rae, Managing Director of DTR:UK, said: "We are recognised as one of the larger architecture companies in the North of England, with national and international clients. In merging our teams with the SMC Group we see the opportunity to attract larger projects in regional areas where there is considerable growth in both public and commercial sectors". For further information contact: SMC Group PlcStewart McColl020 7495 5335 Bell PottingerDavid Rydell/Geoff Callow020 7861 3232 Noble & CompanyMatthew Hall/Rory Boyd020 7763 2200 Notes to Editors SMC Group Plc is the holding company for a group of architects and designers. Ithas established expertise in a broad range of sectors, including residential,retail, industrial, workplace, transportation, leisure and education. With theaddition of DTR:UK, the Group has national coverage throughout England, withoffices in London, Warwick, Manchester, Leeds, Birmingham, Liverpool andLancaster, and is engaged in a range of projects throughout the UK, in Eire andin parts of mainland Europe. The Company's core strategy is to create an architectural group with the scaleand expertise to access the most profitable schemes across a range of sectorsand geographical locations. The Group intends to focus on its organic growth,increasing its share of the UK market and securing larger, higher marginprojects. The Group plans to complement this organic growth withearnings-enhancing acquisitions in order to consolidate its geographic andsector coverage. On 5th September 2005 the company announced its maiden interim results for thesix months ended 30th June 2005. SMC reported turnover of £5.4m (an increase of47% compared to the same period in 2004) and profit before tax of £1.1m (anincrease of 110% compared to the same period in 2004). The company alsoannounced plans to introduce a maiden dividend in June 2006. This information is provided by RNS The company news service from the London Stock Exchange