20th Aug 2018 10:14
LONDON (Alliance News) - IT services firm Adept Telecom PLC said Monday it had agreed to acquire peer Shift F7 Group Ltd for up to GBP7.9 million in cash.
Adept will pay an initial GBP5.0 million. This initial payment will be adjusted less net debt and tax liabilities of Shift F7 at the end of July. Adept will fund the initial cash element through a drawdown on its existing revolving bank facility.
A further GBP2.9 million is deferred cash payment is dependant on performance over the year following completion of the acquisition.
"We are delighted to have acquired such a high quality, well-run and profitable business with a strong management team," Adept Chief Executive Officer Ian Fiskwick said. "Shift F7 is an excellent fit because it enhances our market position in IT, particularly in London."
For the year ended May, Shift F7 generated GBP700,000 in earnings before interest, taxes, depreciation and amortisation on revenue of GBP5.0 million. For comparison, Adept generated GBP9.8 million in Ebitda on revenue of GBP46.4 million for the year ended March.
"Shift F7 complements our acquisition of OurIT in February 2017 which is also focused on London and South East commercial customers," Fishwick added. "After the Shift F7 acquisition, more than 70% of AdEPT revenue will be generated from managed services including IT support, unified communications and data networks. The acquisition is expected to be earnings enhancing from completion."
In February 2017, Adept acquired Our IT Department Ltd for up to GBP8.6 million.
Shares in Adept were 5.6% higher at 372.68 pence on Monday.
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