Empresaria Group Regulatory News (EMR)

6 October 2016

Empresaria Group plc ("Empresaria")

Investment in ConSol Partners

Empresaria (AIM: EMR), the international specialist staffing group, is pleased to announce the investment in a 65% interest in ConSol Partners (Holdings) Limited ("ConSol").

Investment highlights:

· Empresaria has agreed to purchase 65% of ConSol for a total cash consideration of approximately £9.4 million. The remaining 35% interest is held by the senior management team, in line with Empresaria's management equity philosophy.

· ConSol is a specialist recruitment group in the IT sector with a focus on the niche sectors of communications & mobile, cloud technologies and the digital supply chain, operating in the UK, USA and Continental Europe.

· ConSol provides both contract and permanent staffing services, with 57% of net fee income in 2015 coming from contract services.

· ConSol is profitable and cash generative. During the financial year ended 31 December 2015 ConSol achieved unaudited revenues of £23.4 million, unaudited net fee income of £7.6 million and unaudited profit before tax of £1.2 million.

· The board of directors of Empresaria ("Board") believes the investment will be earnings enhancing on an adjusted basis in the first full year in the Empresaria group.

ConSol overview

ConSol has a niche focus on the communications & mobile, cloud technologies and the digital supply chain sectors of IT recruitment having started business from a London base in 2008 and expanded into the UK and Continental Europe, with a strong presence in Benelux and Germany. In 2013 the business grew organically into the US and now operates from offices in Los Angeles and Boston. The spread of net fee income is evenly split between the three main regions of UK, USA and Continental Europe (includes the rest of the world). ConSol has not experienced any change in trading in the UK since the EU referendum vote. In 2015 57% of net fee was from contract placements.

The investment complements Empresaria's stated growth strategy of developing leading brands in their sectors, with a business that is already diversified geographically. The business is focused on specialist professional roles and has a good proportion of contract income. The niche sectors in which they operate are expected to see strong growth opportunities in the coming years and this investment will strengthen Empresaria's presence in the IT & Design sector.

Alongside the strategic rationale, ConSol is profitable and cash generative. The Board believes the investment will be earnings neutral on an adjusted basis in the 2016 financial year and will be earnings enhancing on an adjusted basis in its first full year in the Empresaria group.

Summary of the investment terms

The senior management team of ConSol will retain a 35% shareholding. In line with Empresaria's other management equity arrangements, the shares held by management are not subject to any put and call options; rather they are expected to be held for a minimum holding period, in this case three to four years, before they can be voluntarily offered for sale to Empresaria over a minimum of a further two years.

The consideration is fully payable in cash, with an initial payment on completion of £4.0m and a deferred amount, expected to be approximately £5.4 million, subject to a net asset value adjustment once completion accounts have been finalised, payable in January 2017. ConSol has net assets of approximately £2.7 million.

The investment is funded by the existing multi-currency Revolving Credit Facility of £10.0 million and operating cash flows of Empresaria. With the timing of this investment late in the 2016 financial year the Board acknowledges the year end ratio of debt to debtors will increase above its target of 25%. However, it believes this is in the best interests of Empresaria in the short-term due to the availability of long-term debt during this period of historically low interest rates. Empresaria is cash generative and the Board remains committed to returning the debt to debtors ratio to its target of 25% by 2018.

Chief Executive Officer, Joost Kreulen said:

"We are delighted to announce another investment in a leading brand, in line with our stated strategy, which further strengthens our presence in IT recruitment, a market with high growth prospects. The ConSol business is geographically diversified, profitable and cash generative, with a good proportion of temporary/contract business and a track record of strong organic growth. This investment complements Empresaria's current operations and is expected to be earnings enhancing during its first full year with Empresaria. We are excited by the growth plans for ConSol as part of the Group and look forward to working with the management team to ensure we maximise the potential for the business."

Enquiries:

Notes for editors:

· Empresaria Group plc is an international specialist staffing group with 21 brands operating in 19 countries across the globe including the UK, Germany, Japan, India, UAE, Indonesia, Chile, Australia, Thailand, Singapore, Finland, USA, New Zealand and the Philippines.

· Empresaria offers temporary/contract and permanent staffing solutions as well as Offshore Recruitment Services in seven key sectors including Technical & Industrial, Aviation Services, IT & Design, Professional Services, Healthcare and Retail.

· Empresaria applies a multi brand, management equity philosophy and business model, with Empresaria group company management teams holding significant equity in their own business.

· Empresaria is listed on AIM under ticker EMR. For more information: empresaria.com