PROACTIS Holdings PLC Acquisition (8749N)
February 03 2016 - 2:00AM
UK Regulatory
TIDMPHD
RNS Number : 8749N
PROACTIS Holdings PLC
03 February 2016
Date: 3 February 2016
On behalf of: PROACTIS Holdings PLC ("PROACTIS" the
"Company" or "the Group")
Embargoed until: 0700hrs
PROACTIS Holdings PLC
Acquisition of Due North Limited
PROACTIS Holdings PLC, the specialist Spend Control software
provider, is pleased to announce that it has acquired the entire
issued share capital of Due North Limited ("Due North"), a
well-respected provider of eProcurement solutions from its parent
company, Access Intelligence PLC (AIM: ACC), for a gross cash
consideration of GBP4.5 million ("the Acquisition").
Highlights
-- The Acquisition enhances the Group's position as a leading provider of eProcurement systems to the UK market, now
serving over 800 clients (300 new clients from the Acquisition)
-- The Acquisition is expected to be immediately earnings enhancing and is financed from non-dilutive capital
-- Annual recurring revenue from Due North is approximately GBP1.6 million through its 3-4 year contracted
subscription business model
-- Substantial cross-selling opportunities from PROACTIS' wider portfolio of solutions
-- The Acquisition increases the Group's scale and operational synergies are expected to further enhance Group
profitability
Details of the Acquisition
The Acquisition is in line with the Company's strategy of
augmenting its organic growth with selective acquisitions.
Due North is a well-respected provider of eProcurement systems,
with more than 300 clients principally in the UK Public sector. Its
clients use Due North's hosted software to control an estimated
GBP100 billion of spend through approximately 200,000 active
suppliers by approximately 20,000 procurement professionals.
Due North's expertise in the UK Public sector is complementary
to PROACTIS' business and the combination offers the opportunity
for Due North's clients to access the broader solutions offered by
PROACTIS, as well as substantial operational synergies in the short
and medium term. The Acquisition is expected to be immediately
earnings enhancing.
For the audited year ended 30 November 2014, Due North reported
revenue of GBP2.0m on which it made an operating profit (before
depreciation and amortisation) of GBP0.5m and its reported net
assets were GBP2.3m. For the financial year ended 30 November 2015,
Due North's unaudited management accounts report a revenue
contribution of GBP1.8 million with EBITDA of GBP0.4 million and
profit before tax of GBP0.2 million. The total value of the net
assets being disposed of as at 30 November 2015 was approximately
GBP2.5 million.
Further information on the Acquisition and new banking
facilities
The gross cash consideration payable at completion is GBP4.5
million which the Group will fund through a combination of bank
debt and its own cash resources. The bank debt will be provided by
HSBC Bank plc, by way of a term loan of GBP3.0 million repayable
over four years at an interest rate of 1.85% per annum over
LIBOR.
Rod Jones, CEO of PROACTIS, commented:
"I am delighted to announce the acquisition of Due North which
is an excellent strategic fit - consolidating the Group's position
as the largest independent eProcurement solution provider in the UK
market. Due North's market penetration is substantial and should
immediately benefit the wider PROACTIS business. I look forward to
working with the team at Due North to grow the business and provide
the wider client base with our end to end solutions."
Enquiries:
PROACTIS Holdings PLC
Rod Jones, Chief Executive Via Redleaf Communications
Officer
Tim Sykes, Chief Financial
Officer
Redleaf Communications
Rebecca Sanders-Hewett
Sarah Fabietti
Harriet Lynch 0207 382 4730
finnCap Limited
Stuart Andrews
Carl Holmes 0207 220 0500
Notes to Editors:
PROACTIS creates, sells and maintains specialist software which
enables organisations to streamline, control and monitor all
internal and external expenditure, other than payroll. PROACTIS'
solutions are used in over 800 organisations around the world from
the commercial, public and not-for-profit sectors. It is the
largest independent eProcurement solution provider to the UK Public
Sector.
PROACTIS is head quartered in Wetherby, West Yorkshire. It
develops its own software using an in-house team of developers and
sells through both direct and indirect channels via a number of
Accredited Channel Partners.
PROACTIS floated on the AIM market of the London Stock Exchange
in June 2006.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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