Acquisition

13 Feb 2006 14:00

Newcourt Group plc13 February 2006 Newcourt Group plc Acquisition 13 February 2006 Newcourt Group plc ("Newcourt" or the "Company") announces that it has acquiredKenny-Whelan Associates Limited ("Kenny-Whelan") through its wholly-ownedsubsidiary Sigmar Group Limited. Kenny-Whelan, which is based in Cork, specialises in the provision of outsourcedstaffing, recruitment and human resource services, principally through theprovision of contract staff to the pharmaceutical and engineering sectors. Itcounts a number of leading national and international companies amongst itsclients to whom it supplies qualified and experienced engineering and othertechnical staff from its extensive data base of experienced contract personnelon long and short term contracts. The firm was established in 1989 and employs four consultants, all of whom arebased in Cork. Tom Whelan will continue as Managing Director of Kenny-Whelanand will join the Executive Management Committee of Sigmar Group Limited, therecruitment and outsourced staffing solutions division of Newcourt. The consideration for the acquisition comprises an initial payment of €2.475m atcompletion, together with additional amounts based upon the financialperformance of Kenny-Whelan over the next two years. These additional amountswill vary in accordance with a formula that reflects the levels of growth inprofitability that Kenny-Whelan achieves. The formula also contains certainprotections in favour of Newcourt in the event that Kenny-Whelan does notperform as expected. The maximum additional consideration payable under thesearrangements has been capped at €7.5 million. In the year ended 30 June 2005, Kenny-Whelan had turnover of €10.6m and profitbefore tax of €321,000. Net assets at 30 June, 2005 were €12,000, includingindebtedness of €670,000. The acquisition will be funded through Newcourt'sexisting resources. The price paid for Kenny-Whelan reflects Newcourt's viewof the likely levels of maintainable profit after synergy benefits and othercost savings going forward. Commenting upon the acquisition, John Barry, Managing Director of Sigmar Group,said: "We are delighted that Kenny-Whelan is becoming part of Newcourt and that TomWhelan will be bringing his broad range of expertise and experience to theSigmar Group. Kenny-Whelan has a strong presence in the pharmaceutical andengineering sectors and we hope to broaden and expand this further over thecoming years. The quality of Kenny-Whelan's client base together with thedepth and experience of its contractors will bring an added dimension to theservices that the Sigmar Group can offer. This acquisition also allows us todeepen our presence in the Irish market, both sectorally and geographically andshould place Newcourt in a strong position to capitalise further on the expectedgrowth in the Irish economy over the coming years." Commenting on the acquisition, Tom Whelan, Managing Director of Kenny-Whelan,said: "The combination of Kenny-Whelan with the Sigmar Group makes financial andbusiness sense for both companies. Sigmar Group will broaden its serviceoffering through Kenny-Whelan's experienced contract personnel business, whileKenny-Whelan will benefit from the additional resources and scale that SigmarGroup will bring as part of Newcourt Group Plc, one of Ireland's fastest growingoutsourced and support service businesses. There will be no noticeable changeto our business arising from this transaction and our clients and contractorswill continue to enjoy the same high level of service that they have experiencedto date. I am looking forward to working closely with John Barry and hiscolleagues over the coming years to consolidate Kenny-Whelan's strong marketposition and develop additional new business for the group." For Further Information please contact: Ted O'Neill, Group Chief Executive, Newcourt Group plcMobile: +353 86 8214467 John Barry, Managing Director, Sigmar Group LimitedTel: +353 1 4744644 This information is provided by RNS The company news service from the London Stock Exchange