Rm Regulatory News (RM.)

30 Jul 2008 07:00

RM acquires specialist education technology supplier EasyTrace  

RM announces the acquisition of specialist education software provider Orchard Partners Ltd (which trades as EasyTrace) for a total consideration of up to £2.8m. EasyTrace designs, develops and supplies smart card and biometric solutions, which include unique intellectual property, for education establishments in the UK. RM already works with EasyTrace on BSF (Building Schools for the Future) and other projects.

Orchard Partners' revenue in the year to March 2008 was £1.6m, double that in the previous year; profit before tax for the year was £0.46m. RM will pay an initial consideration of £1.0m in cash and £1.3m in loan notes redeemable after more than two years. A deferred consideration of up to £0.5m is payable in cash over the next two years, subject to the achievement of certain performance conditions.

EasyTrace provides integration services, infrastructure and its own software for identity management and authentication. It has a market-leading product range covering identity production, cashless catering, building access control, electronic registration, print & copy control and electronic lockers. Products and services of this type are typically specified for BSF schools and Academies; EasyTrace is currently involved in 16 BSF projects, working with both RM and other ICT suppliers. Following the acquisition, EasyTrace will be managed alongside Sentinel Products and benefit from the Group's technical, financial and management resources. The current senior management team, including the Managing Director, will remain to oversee the further growth of the EasyTrace business.

Commenting on the acquisition, Terry Sweeney, CEO Designate of RM, said:

'EasyTrace complements our Learning Technologies activities very well. We are increasingly being asked to supply and integrate the smart card and biometric solutions they specialise in - particularly by our BSF clients. With growing demand for these technologies, it makes sense to have this kind of capability within the Group.

'Like us, EasyTrace specialises in making innovative technology work well in challenging education environments. We have already built a good working relationship with Tim Baker and his team and I'm delighted that they have chosen to become part of RM.'

Tim Baker, Managing Director of Orchard Partners Ltd, added:

'In the last two years, EasyTrace has grown rapidly in response to increasing demand from our educational clients. In order to continue our growth, and to take the business to its next stage of development, we needed access to additional financial and managerial strength. I am pleased that, in RM, we have found a partner who can provide that strength.'

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Notes:

Founded in 1973, the RM Group is a leading provider of educational products and services to schools, colleges and universities, local government and central government education departments and agencies. RM works closely with educationalists to create new products, processes and technology which improve teaching and learning. RM is listed on the main market of the London Stock Exchange under the symbol RM.L, ISIN GB0002870417.

Orchard Partners Ltd is based in Basingstoke and has 18 employees. Tim Baker, the current Managing Director, assumed a controlling interest in the Company in 1997, and has been developing its position in the smart card and biometric solutions market since.

Sentinel Products was acquired by RM in February 2004. It supplies specialist education network management software, predominantly through a UK dealer channel.