4th Nov 2014 09:23
(An item published at 0921 GMT misstated the number of shares the directors are subscribing for. The correct version follows.)
LONDON (Alliance News) - Recruitment company Impellam Group PLC Tuesday said has bought IT staffing company Lorien Ltd for GBP29.8 million and plans to raise GBP15 million in a new share placement to part fund the acquisition.
Impellam will issue 3.3 million new shares at a price of 460 pence each, the proceeds of which will be used to buy Lorien.
Impellam will pay GBP22.3 million in cash and GBP7.5 million in new shares, assume GBP14 million in debt, and make additional performance-based payments of GBP6 million in January 2015 and GBP13.9 million the following year. The shares used in payment are subject to a 12-month lock-in period.
"The acquisition of Lorien is a significant step for Impellam and makes us the second largest staffing company in the UK," said Chief Executive Julia Robertson. "It has long been our ambition to develop a substantial presence in IT staffing and I am delighted that Lorien, as a market leader in UK technology staffing, is now part of the group."
The cash component will be part-funded by cash reserves, proceeds from the equity placing, a new GBP15 million five-year loan and an extension to its current invoice discounting facility to GBP120 million, from GBP80 million.
Lorien is expected to report adjusted earnings before interest, taxes, depreciation and amortisation of GBP8.7 million in the year to January 31 on net fee income of GBP24 million and turnover of GBP330 million. It had net assets of GBP6.7 million on September 30.
Impellam said the new shares are expected to start trading on London's AIM on November 7 and the company's enlarged share capital will be 48.8 million shares. Directors Eileen Kelliher and Mike Ettling, as well as Robertson, will subscribe to 28,240 new ordinary shares in total at the placing price.
The company added that Impellam's second half performance so far has been in line with expectations.
In morning trade, Impellam shares were up 2.9% at 473.50 pence.
By Ian Edmondson
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