Servoca Regulatory News (SVCA)

7 Dec 2007 08:45

Servoca PLC07 December 2007 Servoca Plc ("Servoca" or "the Company") 7 December 2007 Acquisition of Security Businesses and Appointment of Director Servoca Plc, which provides specialist outsourced solutions to police forces,local and national government and companies throughout the private sector, ispleased to announce that it has acquired the entire issued share capital of bothInternational Security & Surveillance Limited ("ISS") and ISS Special ProjectsLimited ("ISS(SP)"). The company is also pleased to announce the appointment ofGlenn Swaby as Managing Director of Servoca's security division. Details on ISS ISS trades from two locations with its head office based in the Thames Valleyand an office in Edinburgh. ISS provides security and manned guarding services.ISS has a total staff including guards of approximately 150. In the auditedaccounts for the year to 30 June 2007 ISS achieved a profit before tax of £27kon turnover of £3.47m. ISS's main clients are blue chip organisations which arebased within the aviation industry and the corporate commercial markets. Inaddition ISS is well placed within the theatre, arts and exhibition sectors. At30 June 2007, ISS had audited net assets of approximately £307k. Terms of the acquisition Servoca will pay cash consideration of £0.7m and will issue 1,337,142 Servocafully paid ordinary shares, which at a mid price of 44.5 pence each, equates toapproximately £595,000. Details on ISS(SP) ISS(SP) also trades from one location based in the Thames Valley. ISS(SP)provides Intelligence led security solutions including close protection , riskmanagement, surveillance and proactive security ISS(SP) has a total staff of 3.The founder of ISS(SP) has agreed to remain with Servoca for a minimum of threeyears. In the audited accounts for the year to 30 June 2007 ISS(SP) achieved aprofit before tax of £734k on turnover of £1.84m. ISS(SP's) services areprovided to substantial organisations based both in the UK and internationallythat require confidential and low profile assignments to be undertaken. At 30June 2007, ISS had audited net assets of approximately £159k. Terms of the acquisition Servoca will pay cash consideration of £0.87m and will issue 1,142,857 Servocafully paid ordinary shares, which at a mid price of 44.5 pence each, equates toapproximately £509,000. The Directors believe that the acquisitions will be earnings enhancing and willallow Servoca to further develop its operations in both the policing andsecurity markets as well as providing an additional service offering toServoca's current client base. Funding The Group has secured funding from The Royal Bank of Scotland Plc of £4.7million for working capital and short term acquisition finance. The short termacquisition finance is being provided in the form of a secured loan secured overthe assets of the Group and guaranteed by Southwind Limited. Southwind Limitedis a related party by ownership of 10.4% of the Company's issued share capital.The Directors of the Company, having consulted with JMFinn Capital Markets,consider that the terms of the Southwind limited guarantee are fair andreasonable insofar as its shareholders are concerned. Application has been made for 2,479,999 new ordinary shares to be admitted totrading on AIM. The new ordinary shares will rank pari passu with existingordinary shares in the Company and trading in these shares on AIM is expected tocommence at 8.00 am on 13 December 2007. Commenting on the acquisition, Darren Browne Chief Executive said: "We are delighted to have completed our first two acquisitions in the securitysector. The acquisition of ISS and ISS(SP) will allow Servoca to provide widerservice offerings to our existing client base as well as gaining an entry intothe manned guarding, protection and surveillance services markets, which willprovide Servoca with visibility of earnings which are profitable." In addition to the acquisitions of ISS and ISS(SP) we are pleased to announcethe appointment of Glenn Swaby, aged 51, to the board of Servoca Plc. Glenn, achartered accountant, has a wealth of experience within the security market andwas until recently the financial director of First Security Group Limited, wherehe played a key role in the development of the Company over the past nine years.Glenn will have day to day responsibility for all Servoca Security brands. We are pleased to welcome ISS and ISS(SP) to Servoca and look forward to workingwith their employees to help develop the businesses still further." Contacts: Servoca PlcDarren Browne 020 7747 3030Andrew Brundle 020 7747 3030 JMFinn Capital Markets LtdGeoff Nash 020 7600 1658 Appendix: Glenn Swaby does not have any interest in the issued share capital of theCompany. In accordance with Schedule 2(g) of the AIM Rules, the following information inrelation to the appointment of Glenn Swaby to the Board of Servoca Plc isdisclosed: Glenn Swaby has no current directorships or partnerships and has held within thefive preceding years the following: Past directorships and partnerships:First Security Group LimitedFirst Security (Guards) Limited Whilst Glenn Swaby served as a director of Aqualife Bathrooms Limited, areceiver was appointed on 15 February 1991. Creditor losses were approximately£400,000. Save as set out above, there is no further information to be disclosed in respect of Schedule 2(g) of the AIM Rules. This information is provided by RNS The company news service from the London Stock Exchange