6 Oct 2008 13:14
IFG GROUP PLC
6 October 2008
IFG Group plc ('IFG') is pleased to announce the acquisition of two Irish pensions companies for a consideration of up to €13,572,500 comprising initial consideration of €5,872,500 and contingent deferred consideration of €7,700,000.
IFG has agreed to acquire the entire issued share capital of Pensco Limited ('Pensco'). The acquisition of Pensco is subject to approval from the Financial Regulator and completion will be effected once the appropriate approval is received.
IFG has also completed the acquisition of the entire share capital of Nameridge Limited ('Nameridge').
PENSCO
Pensco, which commenced trading in 2005 is based in Dublin and is engaged in the provision of pensions administration and consultancy services, specialising in defined contribution group schemes. Pensco has developed a leading-market technology framework with the ability to provide customers with real time information on the value of their pension, asset mix of their investment and default investment with lifestyle options. This pension management platform is robust, integrated and secure and will bring significant added value to the existing IFG business both in terms of its scalability and its flexibility in times of investment volatility.
Pensco is being acquired from its current owners, FEXCO, who hold 67.46% of the issued ordinary share capital, with the balance of the ordinary share capital and deferred share capital being held by Pensco board members and its executive management. The initial consideration is €4,062,500 and is payable in cash on Completion. Additional consideration, up to an amount of €3,000,000 in cash, may also become payable to certain of the Vendors based on the achievement of certain agreed turnover and profit thresholds in the period from Completion to 31 December 2012.
In the year ended 31 December 2007, the last date to which audited accounts were prepared, Pensco had turnover of €578,638 and a loss on ordinary activities before tax of €1,063,838. At 31 December 2007 it had gross assets of €1,091,017. Net assets being acquired are approximately €320,000.
The business of Pensco, which has current annual business revenues of approximately €700,000, will be integrated with IFG's existing Irish financial services group pension activities, including the business of Nameridge, and will significantly enhance IFG's offering in group pension advisory and administration to its clients in Ireland.
The Acquisition Agreement contains normal warranties and indemnities in favour of IFG.
NAMERIDGE
IFG has completed the acquisition of the corporate pensions division of Pension Systems Limited, which had traded as PSL Consulting. As part of an internal re-organisation within Pension Systems Limited, both its corporate and credit union businesses were transferred to separate stand-alone businesses and IFG are acquiring the standalone corporate pensions business, Nameridge Limited ('Nameridge').
Nameridge is the culmination of a business initially established in 1969 by Noel Kierans and since 2003 jointly owned with Seamus Keane. In recent years the company has traded as PSL Consulting and has achieved significant success in the management, administration and advisory elements of the Defined Contribution Pensions sector. It is Dublin based and enjoys long standing relationships with well known corporate clients across all sectors of Irish Industry.
Nameridge is being acquired for base consideration of €3,010,000 of which initial consideration of €1,810,000 was paid in cash on Completion. Deferred consideration of €1,200,000 has been placed in Escrow on Completion and is subject to release upon achievement of certain agreed turnover thresholds in the two year period from Completion. Further additional consideration up to an amount of €3,500,000 may also become payable based on the achievement of certain agreed turnover and new business thresholds in the three year period from Completion.
In the year ended 31 December 2007 turnover related to the business now operated by Nameridge amounted to €830,000. Renewal income arising from the corporate client base constitutes a significant portion of that income stream. Annualised profit is estimated in excess of €500,000. Net assets being acquired amount to €13,599.
The Acquisition Agreement contains normal warranties and indemnities in favour of IFG.
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Commenting on the announcement, IFG Group Chief Executive, Mark Bourke, said:
"With these acquisitions, IFG Group is expanding its presence in the Irish pensions market. We are executing our Group wide strategy, building assets under advice and administration. We have firmly established ourselves as leading pension providers in Ireland, and continue to pursue our goal of being best in class for technical expertise, technology and service delivery."
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For reference:
Mark Bourke Gary Owens
Group CEO Chief Executive
IFG Group plc IFG Ireland
Tel: 01 275 2800 Tel: 01 275 2800