Gresham Regulatory News (GHT)

RNS

4 July 2018

Gresham Technologies plc

Acquisition of B2 Group S.a.R.L ("B2 Group")

Gresham Technologies plc (LSE: "GHT", "Gresham" or the "Group"), the leading software and services company that specialises in providing real-time data integrity and control solutions, is pleased to announce that it has completed the acquisition of the entire issued share capital of B2 Group S.a.R.L (the "Acquisition") for a total consideration of up to EUR 8.5 million, comprising initial consideration of EUR 3.65 million ("Initial Consideration") and deferred consideration of up to EUR 4.85 million ("Deferred Consideration").

The Acquisition adds cash management and payments integration solutions to Gresham's portfolio of Clareti applications, thus increasing the Group's addressable market, has a clear financial rationale and supports Gresham's strategic plan to create a global enterprise financial technology business. Highlights of the Acquisition are as follows:

· Adds approximately EUR 1.4 million of annualised recurring revenues ("ARR").

· Expected to be earnings enhancing in the first full financial year following Acquisition.

· Acquires approximately 15 new customers, comprising corporates, banks, insurers and asset managers.

· Provides an enlarged footprint in continental Europe and an established trading subsidiary in Luxembourg.

· Strong growth potential and opens up the larger cash management and payments solutions markets.

· Complements Gresham's existing Clareti Accounts Receivables Management and Clareti Transaction Control solutions.

· Adds 14 staff with expertise in cash management, securities and payments integration, straight-through-processing and secure cloud hosting solutions.

About B2 Group

B2 Group, based in Luxembourg and with offices in London, are specialists in bank-to-corporate integration and cash management software with a focus on the growing multi-bank solutions market. B2 Group's core product is an innovative, proprietary, cloud-based software platform that connects corporates and asset managers with their bank partners. It provides organisations with real-time visibility of their cash position, improved control of outgoing payments and automated processing of incoming statements.

In the year to 31 December 2017, after conversion to IFRS, B2 Group generated revenues of EUR 1.75 million, recording adjusted EBITDA of 0.14 million and a statutory loss of EUR 0.38 million, with gross assets as at 31 December 2017 of EUR 0.76 million.

Initial Consideration

The Initial Consideration is being satisfied as to EUR 3.35 million in cash from Gresham's existing reserves and EUR 0.3 million through the issue of 134,440 newly issued ordinary shares of 0.5 pence each in the capital of the Company ("Ordinary Shares"). The 134,440 new Ordinary Shares ("Initial Consideration Shares") will be allotted (credited as fully paid) to B2 Group's shareholders at a price of 197.4 pence per share (being the average of the closing middle-market quotations of an Ordinary Share over the five dealing days prior to the date of completion as derived from the Daily Official List of London Stock Exchange).

Deferred Consideration

The Deferred Consideration will be calculated based on the achievement by B2 Group of certain ARR and profitability targets over the two-year period following completion of the Acquisition ("Completion"). Subject to and depending on the achievement of those targets, an initial payment of Deferred Consideration will be paid after the date falling 12 months from Completion and a further payment of Deferred Consideration will be paid after the date falling 24 months from Completion, up to an aggregate maximum of EUR 4.85 million. The Deferred Consideration will be satisfied in cash except that Gresham may elect to satisfy up to 50% of the Deferred Consideration through the issue of new Ordinary Shares. Customary 12 month orderly marketing provisions will apply to any new Ordinary Shares issued pursuant to the Acquisition.

Admission of the Initial Consideration Shares

Application will be made for the admission to trading of the Initial Consideration Shares on the Main Market of the London Stock Exchange and to listing on the Official List of the UKLA, with dealings expected to commence at 8 a.m. on 9 July 2018.

Following the issue of the Initial Consideration Shares, which will rank pari passu with all existing Ordinary Shares, the Company will have a total of 67,739,437 Ordinary Shares with voting rights in issue. The Company currently holds no shares in treasury.

The figure of 67,739,437 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company under the FCA's Disclosure Guidance and Transparency Rules.

Ian Manocha, Gresham CEO, commented:

"We're delighted to be announcing today's acquisition of B2 Group. This exciting combination creates an industry leader in multi-bank integration and control solutions for corporates, banks, insurers and asset managers, it strengthens our cloud capabilities and gives us a platform to further accelerate our growth in continental Europe. I take the opportunity to extend a very warm welcome to the B2 team and B2 customers and look forward to building on the successes to date."

Phil Boland and Marc Binck, B2 Group co-founders, commented:

"Joining with Gresham will enable us to take our innovative multi-bank solutions to a global market. Gresham shares our passion for customers and understands how to support the growth of a successful and talented financial technology team. We are delighted to be joining Gresham."

Enquiries

Note to editors

Gresham Technologies plc is a leading software and services company that specialises in providing real-time data integrity and control solutions. Listed on the main market of the London Stock Exchange (GHT.L) and headquartered in the City of London, its customers include some of the world's largest financial institutions, all of whom are served locally from offices located in Europe, North America and Asia Pacific.

Gresham's award-winning Clareti software platform has been designed to provide financial institutions with complete certainty in their data processing. Clareti is a highly flexible and fully scalable platform for ensuring the integrity of data across an enterprise. It is designed to address today's most challenging financial control, risk management, data governance and regulatory compliance problems.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 ("MAR"). Upon the publication of this announcement via a Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.