TIDMBLV
RNS Number : 5915W
Belvoir Group PLC
12 December 2019
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN
ARTICLE 7 OF THE MARKET ABUSE REGULATION NO. 596/2014 ("MAR")
12 December 2019
BELVOIR!
BELVOIR GROUP PLC
(the "Group", "Company" or "Belvoir")
Earnings Accretive Acquisition
&
Trading Update
Belvoir Group PLC (AIM:BLV), the UK's largest property
franchise, is pleased to announce that Newton Fallowell Limited, a
wholly owned Belvoir Group subsidiary, has today agreed to acquire
the business and assets of the estate agency business operated by
Lovelle Estate Agency Limited and Lovelle Bacons LLP (collectively
referred to as "Lovelles"). Lovelles is an award winning privately
owned independent predominantly franchised estate agency network
operating in Lincolnshire and the Humber region with 19
branches.
The overall consideration for the Acquisition is GBP2.0 million
to be satisfied in cash from existing cash reserves. The
Acquisition will be earnings accretive in 2020.
Lovelles, a third-generation family property business dating
back to 1932, adopted a franchising business model in 2006 as a
means of driving growth. Based on performance in the year to July
2019 Lovelles was the largest agency in its region delivering 1,425
completed sales transactions and managing 1,600 properties and was
named the 'Yorkshire and Humber Agency of the Year' at the recent
Negotiator Awards.
The acquired business and assets (the "Acquired Business" or
"Acquisition") comprises a network of 19 estate agencies, with
eleven branches offering property sales only, two offering lettings
only and six offering both sales and lettings. Twelve of the
branches are franchised with a further three scheduled to be
franchised to the branch manager by April 2020. All of the 36 staff
employed within the six corporate-owned branches and the business
development manager will be transferring to Newton Fallowell
Limited.
The Lovelles network is centred around Grimsby and extends north
to Hull, east to Skegness and south to Lincoln, where it meets the
Newton Fallowell network. Its lettings operation is mainly based in
Grimsby. In line with Belvoir's multi brand strategy, Lovelles will
become part of the Newton Fallowell Group, which will then operate
three brands; Newton Fallowell, Goodchilds and Lovelles. The
combined three networks will comprise 55 offices across the East
and West Midlands and the Humber.
The key strategic driver for the Acquisition is that the
Acquired Business is based on a franchise model with a strong
estate agency heritage, making it a good cultural as well as a
strong geographic fit for the Newton Fallowell Group. The Board
anticipates the following opportunities arising from the
Acquisition:
-- Franchise three of the corporate-owned offices by April 2020
in line with current arrangements
-- Franchise the remaining corporate-owned offices as soon as practicable
-- Introduce lettings to the sales-only franchise offices,
whilst extending the existing sales-focused franchise support
system to include lettings
-- Enhance the legal, compliance, marketing, IT and general
support to franchisees through the Belvoir central franchise
support system
-- Improve the financial services offering through Brook
Financial Services, another Belvoir Group subsidiary
-- Offer the opportunity for accelerated growth under Belvoir's Assisted Acquisitions programme
In the year to 31 March 2019 the Acquired Business made an
operating profit of GBP500,000 and at that date had net assets of
approximately GBP100,000.
The legal form of the Acquisition is split into the acquisitions
of specified parts of two separate legal entities Lovelle Estate
Agencies Ltd ("LEA Ltd") and Lovelle Bacons LLP ("LB LLP") which
are under the common ownership of the vendors. Completion is
expected to take place on 6 January 2020 in respect of LEA Ltd and
on 20 January 2020 in respect of LB LLP. LB LLP will continue to
operate its surveying and commercial arms.
Current trading
Trading in the second half of the financial year to date
continues to be strong, and the Board is confident that the Group
is in line to comfortably achieve market expectations for the full
year.
Dorian Gonsalves, CEO of Belvoir, commented:
"Lovelles offers the Belvoir Group the opportunity to expand its
franchise network significantly by a further 19 offices operating
under a highly regarded regional brand. I would like to pay tribute
to Jonathan Lovelle who is well respected within the property
sector and has built Lovelles into a highly successful franchise
network. We believe that as part of the Belvoir Group, we can
strengthen further the offering to the Lovelles network through our
experienced and professional franchise support team."
Jonathan Lovelle, MD of Lovelles, commented:
"Having seen how the Newton Fallowell network has flourished as
part of the Belvoir Group, I knew that Belvoir would be the right
home for the Lovelles network. Belvoir shares my vision of
franchising as being the optimum business model for our industry
and I know that its management team is committed to supporting the
growth aspirations of all franchisees. I am proud of what our
franchisees have achieved and of the strong reputation that
Lovelles has within the Lincolnshire and Humber region. I look
forward to seeing the network go from strength to strength as part
of the Belvoir Group."
For further details:
Belvoir Group PLC 01476 584900
Dorian Gonsalves, Chief Executive Officer investorrelations@belvoirgroup.com
Louise George, Chief Financial Officer
www.belvoirgroup.com
finnCap
Julian Blunt, Teddy Whiley (Corporate Finance)
Tim Redfern (ECM)
www.finncap.com +44 (0) 20 7220 0500
Buchanan +44 (0) 20 7466 5000
Charles Ryland, Victoria Hayns & Tilly
Abraham
Notes:
About Belvoir Group PLC
Founded in 1995 and listed on AIM in 2012 (BLV.L), Belvoir
operates a nationwide property franchise group with 372 offices
across four brands specialising in residential lettings, property
management, residential sales and property-related financial
services. With its Central Office in Grantham, Lincolnshire, the
Group manages over 64,650 properties and reported record revenues
of GBP13.7m in 2018 making Belvoir the largest property franchise
group in the UK.
For further information, please visit: www.belvoirgroup.com
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END
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