Last checked at 9 May 2014 07:00
9 May 2014
Tullett Prebon plc
Acquisition of PVM
Tullett Prebon plc (the "Company") announces that the Company has reached agreement to acquire PVM Oil Associates Limited and its subsidiaries, ("PVM"), a leading independent broker of oil instruments.
PVM's business is focused entirely on Energy products, and has a long history as an international crude oil and products broker covering OTC swaps, forwards and physical crude oil and refined products, and exchange traded instruments including WTI, Brent and Gasoil futures. PVM's customers are major oil companies, independent refiners and producers, government agencies, trading houses, banks, investment funds and corporations.
PVM is being sold by its management and certain employees. The senior management of PVM will remain with the Company after the acquisition is completed.
For the year ended 31 July 2013, PVM reported revenue of $107.5m (£63.4m) and profit before tax of $18.2m (£10.7m). PVM reported consolidated gross assets at 31 July 2013 of $79.2m (£46.7m).
The total consideration for the acquisition of the equity of the business, which has no debt, and which is estimated to have nil net working capital, is $160.0m (£94.4m). The initial consideration is $112.0m (£66.1m) which will be satisfied through the issue of new Ordinary Shares in the Company. Deferred consideration of up to $48.0m (£28.3m) is subject to the achievement of revenue targets in the three years after completion, and together with any required adjustment to reflect the actual amount of working capital acquired at completion, will be satisfied through the further issue of new Ordinary Shares in the Company, or cash, at the discretion of the Company. The payment of deferred consideration to an individual is linked to their continued service with the business and the deferred consideration amount will therefore be amortised through the income statement over the three years following completion.
Completion of the transaction is subject to FCA Change of Control Approval being obtained and the satisfaction of certain other conditions including admission of the new Ordinary Shares to the Official List and to trading on the London Stock Exchange.
The acquisition of PVM will increase the scale of the Group's activities in the Energy sector and will give the Group a significant presence in broking crude oil and petroleum products complementing its existing activities in these areas. Crude oil is the world's most actively traded commodity. The acquisition will also allow Tullett Prebon Information to expand its data offering to include the current and historical oil price data generated from the PVM business and to offer this data to a broader set of customers.
Enquiries:
Nigel Szembel, Head of Communications, Tullett Prebon plc
Direct: +44 (0)20 7200 7722