TIDMBEG
RNS Number : 3964W
Begbies Traynor Group PLC
12 December 2023
12 December 2023
Begbies Traynor Group plc
Acquisition
Expansion of Eddisons property auctions team
Begbies Traynor Group plc (the "group"), the professional
services consultancy, today announces that it has completed the
acquisition of SDL Auctions Limited, which trades as SDL Property
Auctions ("SDL"). SDL will integrate with Eddisons, the group's
property advisory and transactional services division.
SDL is a national firm of property auctioneers, headquartered in
Nottingham and employing 46 staff who will all join the group
following the acquisition. The acquisition will broaden Eddisons
geographical coverage across the Midlands and augment its expertise
and scale in auctions nationally.
In its financial year ended 31 March 2023, SDL generated revenue
from continuing operations of GBP4.5m and normalised pre-tax
profits from continuing operations of GBP0.5m (when reported on the
same basis as the group). Trading is projected to remain at this
level in the current financial year. SDL had net assets of GBP0.2m
(including GBP0.5m net cash) at 31 March 2023.
Reasons for and benefits of the acquisition
The group's overall strategy is to increase the scale and
quality of its businesses, both organically and through
value-accretive acquisitions, thereby delivering strong,
sustainable financial performance.
Our strategy in property services is to enhance and broaden our
service offerings and geographical coverage. Since the creation of
the division through the acquisition of Eddisons in December 2014,
the group has built a strong track record of acquisitions that have
met these criteria. This strategy has increased the scale of the
division to a current run rate in excess of GBP40m, demonstrating
resilience of earnings in a challenging economic environment,
strong growth and profitability whilst enhancing the group's
earnings.
The acquisition is in line with this strategy, enhancing our
auctions service offering. Together with the acquisition of Mark
Jenkinson & Son (the Sheffield property auctioneer) in March
2023, the transaction significantly increases our national coverage
and reinforces our expertise and reputation for the sale by auction
of commercial and residential property, as well as plant and
machinery.
The combined team will be one of the largest property
auctioneers by volume nationally.
Principal terms of the acquisition
The acquisition consideration is structured as follows, based on
current levels of financial performance and on a cash free, debt
free basis:
-- Initial cash consideration of GBP2.5m;
-- Earn out of up to GBP0.75m, payable in cash, subject to
maintaining revenue in the 12 month period post completion.
This gives a maximum consideration of GBP3.25m (on a cash free
debt free basis).
The consideration will be met from the group's existing
financial resources, with significant headroom available for
further acquisitions and investment.
Anthony Spencer, Managing Director of Eddisons, commented:
"I am very pleased to welcome the SDL team to Eddisons. The
acquisition significantly increases the scale of our auction
business and I look forward to working with the team in the future.
This is the fourth acquisition for Eddisons in 2023 and we continue
to seek further opportunities for expansion across the UK."
Ric Traynor, Executive Chairman of Begbies Traynor Group plc,
commented:
"The acquisition of SDL Property Auctions is in line with our
strategy to develop our property advisory and transactional
services division, by increasing both its scale and market
position, as well as the scope of its service offering and
geographical coverage. Our combined team will be one of the largest
property auctioneers by volume nationally.
"SDL has an excellent reputation, and we are looking forward to
working with the team."
Enquiries please contact:
Begbies Traynor Group plc 0161 837 1700
Ric Traynor - Executive Chairman
Nick Taylor - Group Finance Director
Canaccord Genuity Limited 020 7523 8350
(Nominated Adviser and Joint Broker)
Emma Gabriel / Harry Pardoe
Shore Capital (Joint Broker) 020 7408 4090
Malachy McEntyre / Mark Percy / Anita Ghanekar / James
Thomas
MHP 020 3128 8567
Reg Hoare / Katie Hunt begbies@mhpgroup.com
Information on Begbies Traynor Group can be accessed via the
group's website at
www.ir.begbies-traynorgroup.com
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END
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