Last checked at 1 Jun 2010 07:00
CCS.L
Clarity Commerce Solutions plc
("Clarity", the "Company" or the "Group")
Acquisition of assets of Cyntergy Services Ltd ("Cyntergy")
Clarity, a leading supplier of software solutions for the hospitality, retail, leisure and entertainment sectors, is pleased to announce the acquisition of the business and assets of Cyntergy Services Ltd for a maximum cash consideration of £150,000 with effect from 28 May 2010.
Background to the acquisition
In February 2010 Clarity announced two multi million pound contract wins with Merlin Entertainments Group Ltd ("Merlin") and Pret A Manger. Since then further contracts have been won including Weston-super-Mare Pier, Bakker Bart (a Dutch bakery chain) and Monmouth County Council. Product roll out is progressing well at Merlin's Gardaland theme park in Italy and the first five Pret A Manger sites have been successfully installed. An additional 220 Pret A Manger restaurants are expected to go live in 2010, with further sites already planned.
These wins underline Clarity's recent success in addressing the market for high value, multi-site, international solutions and bid activity on similar opportunities remains strong. Almost all of these customer wins and bids involve Clarity contracting to provide high quality implementation, training and support services, increasingly in multiple languages. Whilst the Company already has a skilled support services team there is a need to increase resources to support the new customers and anticipated future business.
An opportunity has arisen to acquire such resources in a cost-efficient, low risk manner which, at the same time, adds a number of prestigious customers.
About Cyntergy
Cyntergy provides IT service desk and IT training services to the retail, hospitality and leisure markets, principally in the UK, but also internationally. Its service desk is a 24/7 multi-lingual operation based in Sunbury on Thames operating using ITIL methodology. Cyntergy also provides implementation and training services and is a specialist in creating and delivering eLearning programmes. Cyntergy employs approximately 80 staff across these disciplines.
Cyntergy has a number of blue chip customers who take support services on an ongoing basis.
In the year to 31 March 2009 Cyntergy recorded a profit before interest and tax of £6,000 on turnover of £4,200,000.
Cyntergy was founded in 1993 and was previously acquired by Clarity in September 2004. Clarity then sold the business to its management in May 2008 for £500,000 during a period when Clarity was disposing of certain assets in order to address short term cashflow requirements. Reductions in new software sales in the wider market led to a decline in Cyntergy's training revenues during 2009 and although these revenues have recovered in recent months the consequent trading losses led to Cyntergy being placed into administration.
Details of the acquisition
Clarity will acquire 80 per cent of the business of Cyntergy. Under the terms of the acquisition agreement Clarity will take on all Cyntergy staff and customers and acquire the fixed assets, debtors and deferred income of the Cyntergy business from the administrator.
Consideration will be finalised between £100,000 and £150,000 dependent on certain performance conditions.
Key members of the Cyntergy management will remain in the business to ensure continuity and a successful integration phase.
The Clarity Board believes that acquiring an established quality support operation at this price will meet the Company's requirement to offer these services much more cost effectively, with less risk and quicker than building the operation in-house. Furthermore, Clarity expects that owning this resource will significantly enhance its prospects in future customer bid processes. The Company also expects to build on the customer relationships that Cyntergy already has with its blue chip customer list. It is anticipated that the acquisition will have a neutral impact on Clarity's earnings in the current financial year but will be earnings enhancing in the year to 31 March 2012.
Ken Smith, CEO said "The Cyntergy acquisition significantly enhances the Group's international implementation, support and training capabilities. I am delighted to welcome their staff and customers to the Clarity group and I look forward to reporting progress in due course."
Enquiries:
| Clarity Commerce Solutions plc | Ken Smith/Stephen Sadler | T:01256 365150 |
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| Arbuthnot Securities | Alasdair Younie/Ben Wells | T: 020 7012 2000 |
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| Biddicks | Shane Dolan | T: 020 7448 1000 |