Last checked at 5 Feb 2018 07:00
5 February 2018
Begbies Traynor Group plc
Acquisition
Begbies Traynor Group plc (the "Group") today announces the acquisition of the entire issued share capital of Fyrebrand Limited which trades as CJM Asset Management ("CJM"). The 11 strong team, including management, will be integrated with the Group's existing Eddisons property services division.
CJM was established in 2000, following a management buy out completed by the current management team. The business specialises in the sale of industrial plant and machinery assets through its online platform, physical auction centre and private treaty sales.
CJM services a growing national and international client base which includes large industrial clients together with private clients and local authorities. CJM will be combined with the Group's existing Eddisons machinery and business asset disposal activities, operating as Eddisons CJM.
In the financial year ended 30 November 2017, CJM reported annual revenue of £1.2 million and pre-tax profits of £0.1 million. It had gross assets of £0.3 million as at 30 November 2017.
Principal terms of the acquisition
The acquisition is for an initial consideration of £0.25 million, to be satisfied by £0.15 million in cash from the Group's existing resources and through the issue of 134,462 new ordinary shares of 5 pence each in the Group ("Ordinary Shares"). The acquisition is on a cash free, debt free basis.
Under the terms of the acquisition, additional contingent consideration of up to £0.3 million will become payable subject to the achievement of stretching financial targets for the consolidated machinery and business asset disposal business (representing the existing Eddisons business and CJM) in the three year period directly following completion. Any additional consideration is calculated according to an agreed formula and is payable in cash.
The acquisition is expected to be earnings enhancing both initially, in the Group's current financial year, and after any additional consideration is paid.
An application has been made for 134,462 Ordinary Shares to be admitted to trading on AIM ("Admission") in part satisfaction of the initial consideration. The new Ordinary Shares will rank pari passu with the existing Ordinary Shares in the Group and it is expected that dealings in these new Ordinary Shares will commence on 8 February 2018.
Following Admission, the Group will have 107,760,386 Ordinary Shares in issue. The Group does not hold any shares in treasury and, therefore, this figure may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Group.
Anthony Spencer, Director at Eddisons, commented:
"I am very pleased to welcome the CJM team into Eddisons. The acquisition will enhance our machinery and business asset disposal expertise, complementing our existing operations. This is our third Eddisons acquisition since we joined the Group as we continue to seek opportunities for further growth, both organically and by strategic acquisition."
Ric Traynor, Executive Chairman of Begbies Traynor Group plc, commented:
"The acquisition of CJM is in line with our strategy to develop our property services division, to increase both the scope of its service offering and geographical coverage. In particular, CJM's client base is highly complementary with our existing machinery and business asset disposal activities, which are primarily focussed on the sale of assets out of insolvencies."
Enquiries please contact:
Begbies Traynor Group plc 0161 837 1700
Ric Traynor - Executive Chairman
Nick Taylor - Group Finance Director
Canaccord Genuity Limited 020 7523 4588
(Nominated Adviser and Joint Broker)
Sunil Duggal
Andrew Buchanan
Margarita Mitropoulou
Shore Capital 020 7408 4090
(Joint Broker)
Mark Percy / Anita Ghanekar
MHP Communications 020 3128 8100
Reg Hoare / Katie Hunt
Information on Begbies Traynor Group can be accessed via the Group's website atwww.begbies-traynorgroup.com