STP.L Regulatory News (STP)

3 Apr 2008 07:01

Spiritel PLC03 April 2008 3 April 2008 SPIRITEL PLC ("Spiritel" or "the Company") ACQUISITION OF MOBILE RESELLER, WN1 LIMITED Spiritel makes fifth acquisition completing the Spiritel Business product set with leading mobile reseller Spiritel plc, (AIM:STP), the business communications service provider, ispleased to announce the acquisition of WN1 Limited ("WN1"), for a totalconsideration of up to £2.02 million. Under the terms of the acquisition, Spiritel has agreed to pay a totalconsideration of £2.02 million comprising £1.47 million in cash andperformance-related earn-out payments of up to £0.55 million payable by 31 May2009. The initial cash payment is financed by an increase to Spiritel's seniordebt facility with Clydesdale Bank plc and the subscription by the vendors for£0.3 million of unsecured zero coupon loan notes redeemable on 1 May 2009. Thevendors of WN1 will also receive a payment, equal to WN1's net cash balance oncompletion of £1.09 million. As at 28 February 2008, WN1 had net assets ofapproximately £1 million, including a net cash balance of £1.1 million. In the year to 31 October 2007, WN1 reported revenues of £2.25 million andoperating profits of £0.6 million. The acquisition is expected to becomeearnings enhancing from the point of acquisition. WN1 is a leading accredited reseller of mobile voice, data and Blackberryservices, and holds key industry contracts as an O2 Advance Partner, T-MobileBusiness Partner and a Blackberry Alliance Member. WN1 targets its operationsexclusively towards business clients, which include a number of blue chipcompanies such as Lufthansa, Servisair and Topps Tiles. The purchase of WN1 is Spiritel's fifth acquisition in 18 months and adds mobileservices to the Company's product set, completing Spiritel's fully integratedvoice and data offering which includes VoIP, data networking, telephone systemsand ISP services. It is anticipated that the acquisition will be earningsenhancing immediately upon completion. WN1, to be rebranded as Spiritel Mobile,will be relocated to Spiritel's Wigan office in order to deliver operationalsynergies and cost savings. Commenting on the acquisition, Alastair Mills, Chief Executive of Spiritel said:"WN1 is a strategic and highly profitable acquisition that allows us to completeour business communications offering by adding mobile voice and data services.WN1 has an impressive track record of revenue and profit growth and theincremental earnings will further enhance our recently reported turnaround infinancial performance." He added: "The acquisition supports our strategy of cross selling additionalproducts to our customer base, increasing customer spend, reducing churn andthereby driving our organic growth. WN1 has a particularly strong performance insales of converged Blackberry solutions to business customers and we lookforward to offering WN1's full range of mobile voice and data services toSpiritel's existing customers." Darren Halliwell, Managing Director of WN1 added: "This is a very excitingpartnership for WN1's staff and customers. Spiritel is recognised as a leadingprovider of converged communications to business customers and we are lookingforward to building on WN1's recent success alongside such a well establishedand respected B2B service provider. We are confident that as part of Spiritel'sBusiness Division, we will further capitalise on the opportunity of anaccelerating migration to converged fixed and mobile services." For further information please visit www.spiritelplc.com or contact: Spiritel plc Tavistock Communications Daniel Stewart & Co.Alastair Mills Simon Hudson Simon LeathersChief Executive Clemmie Carr Stewart DickTel: +44 20 7160 0100 Tel: +44 20 7920 3150 Tel: +44 20 7776 6550 Notes to Editors Spiritel is a fully integrated business communications group which enables itscustomers totake advantage of the opportunities created by rapidly changingtelecoms markets as the migration to Internet Protocol (IP) based servicesaccelerates. The Group is a consolidator of the highly fragmented UK telecomsreseller market and is building a substantial customer base and scale throughselective acquisitions. We are organised into two divisions, SpiritelTechnologies - focused on networking and IP products and services - and SpiritelBusiness, which provides services directly to our Business customers. Spiritel offers fixed and mobile voice and data communications solutionsincluding Voice over IP (VoIP), data networking, telephone systems and ISPservices to a rapidly expanding customer base. We are a leader in the provisionof new, but proven, Voice over IP (VoIP) solutions that are firmly based on theold-fashioned service values which run throughout the Group. This information is provided by RNS The company news service from the London Stock Exchange