15th Jun 2015 13:33
LONDON (Alliance News) - Aukett Swanke Group PLC Monday said it has purchased an 80% stake in an architecture, interior design and engineering company that operates in the Middle East, a move it thinks will give it the scale to bid for larger projects in the region.
The international group of architects and interior designers said it purchased the controlling stake in John R Harris & Partners Ltd for a total of GBP897,000, which will be paid in cash and funded from existing resources.
The other 20% of John R Harris will continue to be owned by two of its current directors, who will remain in employment post-acquisition.
John R Harris has 27 staff, which together with Aukett Swanke's existing international network of subsidiaries, joint ventures, associates and licensees creates an enlarged workforce of in excess of 370 staff.
"Aukett Swanke has recognised for some time that its existing operation in the Middle East whilst maintaining a presence in the United Arab Emirates, has lacked the critical mass to successfully bid for some of the larger and more prestigious projects available. This acquisition addresses the regional capacity issue," said the company.
The acquisition is also expected to reduce some overhead costs, and is expected to be "earnings enhancing" in the current financial year due to end September 2015.
John R Harris reported a GBP182,000 pretax profit in 2014 on revenue of GBP2.6 million. Net assets totalled GBP489,000 at the end of that year.
A further term of the acquisition is that, in addition to its share of John R Harris' earnings, Aukett Swanke will be entitled to a fixed annual proportion of its revenue after deduction of sub-consultant costs as an annual management charge.
Aukett Swanke shares were up 6.5% to 8.25 pence per share on Monday afternoon.
By Joshua Warner; [email protected]; @JoshAlliance
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