18 Apr 2016 07:00
18 April 2016
Blancco Technology Group PLC
("Blancco", the "Company" or the "Group")
ACQUISITION OF XCALIBER AND NEW CONTRACT WIN
The Group is pleased to announce the acquisition of the remaining stake it does not already own in Xcaliber Technologies and a significant new contract win.
Acquisition of remaining shares in Xcaliber
The Group has acquired the remainder of the share capital (51%) of Xcaliber Technologies LLC and Xcaliber IP LLC ("Xcaliber"), a privately owned provider of mobile diagnostics software, for a consideration of $5.5 million (£3.8 million using todays spot rates) of which;
- $0.8 million (£0.5 million) is an upfront cash payment funded through the Group revolver facility; and
- A further estimated earn out payment of $4.7 million (£3.3 million) payable over 3 years depending on the business achieving certain revenue targets. The earnout would be payable in cash.
The acquisition takes the Group's stake in Xcaliber to 100%.
On a trailing twelve month basis to 31 December 2015 Xcaliber had revenues of $1.5 million (£1.0 million), growing at strong double-digit rates, and an operating loss of $0.9 million (£0.6 million). At 31 December 2015 it had a balance sheet value of net liabilities of $0.2 million (£0.1 million).
The acquisition further strengthens the Group's product offering and allows the Group to bundle and cross sell its diagnostics solutions and Blancco's market-leading erasure solutions to the same clients.
The founder of Xcaliber will stay with the business for six months for a handover period.
Contract win
The Group is pleased to also announce that Xcaliber has secured a multi-year contract to roll out its retail diagnostics solution to all the retail outlets of a major North American mobile phone operator and retailer. This will cover more than 5,000 retail outlets, and allow the end customers to diagnose over 60 faults with their mobile and tablet devices in store and avoid unnecessary repairs.
This contract is an extension of a previous 200-store trial, and establishes Xcaliber as a Global market leading player in the mobile diagnostics field, in terms of reach and distribution.
This contract roll out has commenced and, after an implementation period, related costs and working capital investment, is expected to contribute to revenue and profit growth in FY 2016.
Matthew Peacock, Non-Executive Chairman of Blancco, said:
"This acquisition completes a strategic investment programme which has brought Blancco, Tabernus, Safe IT and Xcaliber together into a market leading stand-alone Software Group focused on maximising the considerable opportunities in secure, auditable data erasure. We are delighted that Xcaliber has signed such a significant contract in the exciting US market, which demonstrates the strength of its offering and the scope for further growth."
Enquiries:
Blancco Technology Group Plc +44 (0) 20 3657 7000
Matthew Peacock, Non-Executive Chairman
Patrick Clawson, Chief Executive Officer
Jog Dhody, Chief Financial Officer
Peel Hunt LLP (Nominated Adviser and Broker) +44 (0) 20 7418 8900
Richard Kauffer
Euan Brown
Panmure Gordon (UK) Limited (Joint Broker) +44 (0) 20 7886 2500
Dominic Morley, Corporate Finance
Charles Leigh Pemberton, Corporate Broking
Tulchan Communications +44 (0) 20 7353 4200
Tom Murray
About Blancco
Blancco Technology Group Plc, is a leading data erasure software business, serving enterprises and governments around the world.
www.blancco.com
Cautionary statement
This announcement contains forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could, is confident, or other words of similar meaning. Undue reliance should not be placed on any such statements because they speak only as at the date of this document and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and Blancco's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.
There are a number of factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are; increased competition, the loss of or damage to one or more key customer relationships, the outcome of business or industry restructuring, changes in economic conditions, currency fluctuations, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the key timing and success of future acquisition opportunities or major investment projects.
Blancco undertakes no obligation to revise or update any forward-looking statement contained within this announcement, regardless of whether those statements are affected as a result of new information, future events or otherwise, save as required by law and regulations.