Maintel Regulatory News (MAI)

Maintel Holdings Plc ("Maintel" or "the Company")

Acquisition

Maintel Holdings Plc, the telecoms and data services company, announces the acquisition, subject to shareholder approval, on 29 September 2011 of Totility Limited ("Totility"), a specialist UK mobile telecoms provider, for an initial consideration of £2.83m, with a further consideration of up to £4.0m dependent on Totility's performance in the 12 (in certain limited circumstances 13) months post-acquisition (the "Acquisition").

The initial consideration will consist of £2.44m in cash, and the issue of 177,778 shares, which had a mid-market price of 217.5p on 28 September. 

Further consideration will be paid to the Totility shareholders representing the net asset value of Totility at the date of Acquisition. Assets acquired will principally consist of working capital and recurring, renewal and new revenues arising from the customer bases managed under Totility's contracts with Vodafone and O2.

Totility manages approximately 1,100 customers and 12,000 mobile connections under these contracts, and reported unaudited revenues of £2.3m, gross profit of £1.4m and profit before tax of £1.0m for the year to 31 March 2011. Net assets as at 31 March 2011 were £557,000.

Terry McKeever, the managing director of Totility, will retain that position post-acquisition.

In addition to continued organic growth of Totility, the Company envisages significant cross-selling opportunities of its own services into Totility's customer base, as well as the sale of mobile services into its own base.

The Acquisition is conditional upon the Company entering into a loan agreement with John Booth, the Chairman of the Company, whereby Mr Booth would lend the Company up to £1.5m (the "Loan") to partially finance the Acquisition, and to allow the Company to maintain its ability to make other acquisitions of companies or bases as opportunities at appropriate valuations arise. The Loan is unsecured, carries an interest rate of 6.5 per cent. and is repayable by 28 February 2013.

In order to enter into the loan agreement, shareholders will be asked to approve a change to the Company's Articles to alter its ability to borrow, and a circular will be despatched to shareholders to that effect and will be available from the Company's website www.maintel.co.uk. The meeting to approve the change to the Articles will take place on 21 October 2011 and, assuming the proposal is approved, the Acquisition will complete that day.

The loan from John Booth, as described above, constitutes a related party transaction under the AIM Rules.

The Independent Directors, being Eddie Buxton, Angus McCaffrey, Dale Todd and Nicholas Taylor, who have been so advised by the Company's nominated adviser, finnCap Limited, believe that the terms of the Loan are fair and reasonable so far as the shareholders of the Company are concerned.

30 September 2011

Enquiries:

Maintel

Eddie Buxton - CEO 020 7401 4601

Angus McCaffery - Sales Director 020 7401 4646

Dale Todd - Finance Director 020 7401 0562

FinnCap

Marc Young - Corporate Finance 020 7600 1658