TIDMOPM
RNS Number : 9683S
1PM PLC
23 March 2016
For Immediate Release 23 March 2016
1pm plc
("1pm", the "Group" or the "Company")
ACQUISITION OF BRADGATE BUSINESS FINANCE LIMITED FOR UP TO
GBP2.75M
Second significant strategic acquisition within the current
financial year
&
Strong trading momentum maintained across the Group
1pm, the AIM listed independent specialist provider of finance
facilities to the SME sector, is pleased to announce the
acquisition of Bradgate Business Finance Limited ("BBFL") for an
aggregate consideration of up to GBP2.75 million, comprising
GBP2.20 million payable in cash on completion and up to a further
GBP0.55 million in shares over the next three years subject to
certain performance targets being achieved.
Key points:
-- Established in 2006, BBFL is a leading independent specialist
provider of 'hard' asset finance solutions to clients buying
business critical equipment within the construction, recycling and
haulage sectors.
-- The acquisition of a 'hard' asset specialist is complementary
to the 'soft' asset focus of both 1pm and Academy Leasing and will
further expand the SME market sectors served by the Group's range
of products and services.
-- BBFL has achieved an effective and profitable balance between
writing lease business on its 'own-book' and 'broking-on' business
to a high-quality panel of funders in order to generate cash from
commissions, having developed a similar business model to that of
Academy Leasing.
-- With greater access to capital as part of the 1pm group, BBFL
will now have the ability to significantly grow its 'own-book'
whilst continuing to generate cash from broking activities.
-- In its unaudited results for the year ended 31 January 2016
BBFL recorded a profit before tax and after dividends of GBP0.37
million on turnover of GBP1.36 million. In addition, at the
year-end, the aggregate balance of its loan book stood at GBP3.45
million, with net assets at that date of GBP1.20 million.
-- Bad debt write-offs during the year to 31 January 2016
amounted to GBP0.04 million, representing 1.2 per cent. of the
book
-- Following its acquisition, BBFL will operate as an autonomous
business unit within the Group, managed by its existing highly
experienced and well-respected management team.
-- 1pm has financed the cash consideration for the acquisition
from within its existing borrowing facilities. The additional
deferred consideration of up to GBP0.55 million, to be satisfied by
the issue of new shares, is conditional on achievement of annual
business generation targets in each of the three financial years
following completion.
Reasons for the acquisition:
BBFL is a leading independent specialist provider of hard asset
finance solutions to a broad range of largely owner-managed
businesses within the construction, recycling and road transport
sectors. BBFL's core strength is access to a selected network of
panel funders whilst also having the ability to act as a principal
funder. It is therefore able to provide its clients with a wide
range of competitive financing packages with proven sales and
underwriting experience and a record of generating high yields and
strong returns on capital investment. Business is generated
primarily from end-user lessees, but also via key relationships
with equipment suppliers who rely heavily on the sector expertise
of the management team and their ability to secure funding of their
equipment sales. BBFL has a number of established supplier
relationships that can be further leveraged.
Commenting on the acquisition, 1pm CEO, Ian Smith said:
"The Board of 1pm is very pleased to be taking this second
significant strategic step forward in the current financial year
following the successful acquisition of Academy Leasing in August
2015. This transaction is further proof of the Group's intent to
build a significant asset finance and business loans group through
a combination of strong organic growth and carefully selected
acquisitions. The acquisition of BBFL adds the hard assets
category, new SME business sectors and valuable management
experience to our existing asset finance offering."
Richard Arnold, Managing Director of BBFL said:
"We are delighted to have this opportunity to take Bradgate
Business Finance to the next stage in its development. This
transaction will enable the business to grow significantly as part
of the 1pm plc group, allowing us to join forces with 1pm and
Academy to create a strong combined business, whilst continuing to
build on the successful foundations we have laid within our own
particular sectors of expertise."
Commenting on the acquisition and current trading, Chairman John
Newman, added:
"1pm's trading performance in the first nine months of the
current financial year, which includes a six month, contribution
from Academy Leasing, continues to be strong and in line with
management expectations for the financial year ending on 31 May
2016. This latest acquisition will help to enhance the trend of
profitable growth delivered over recent years."
For further information,
please contact:
1pm plc
Ian Smith, Chief Executive
Officer 01225 474230
Mike Nolan, Chief Strategy
and Risk Officer 01942 408520
Helen Walker, Chief Financial
Officer 01225 474230
WH Ireland (NOMAD)
Mike Coe / Ed Allsopp 0117 945 3470
Walbrook PR 0117 985 8989
Paul Vann 07768 807631
paul.vann@walbrook.com
About 1pm:
The Company was admitted to AIM in August 2006.
1pm plc is an established group of independent finance companies
focused on providing SMEs with accessible funding to add value to
their businesses. All customers must have good credit histories and
proven ability to repay their finance commitments.
Mission Statement - 'Helping the UK economy grow by supporting
SMEs'
More information is available on the Company website
www.1pm.co.uk.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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