30th Mar 2015 08:53
LONDON (Alliance News) - CVS Group PLC Monday said it will buy Your Vets Ltd, a provider of small animal veterinary services, for GBP12 million, and has secured new debt facilities to back the acquisition.
YourVets, which operates seven veterinary clinics in the Midlands and Essex, generated revenue of approximately GBP9.2 million in the year to March 31, 2014. Earnings before interest, tax, depreciation and amortisation were around GBP0.2 million, and it made a loss before tax of GBP0.8 million. Net assets were GBP2.4 million.
For the year to March 31, 2015, YourVets sales are expected to be in the region of GBP10 million, while Ebitda is expected to be GBP0.8 million.
CVS will acquire net debt of approximately GBP2 million with the purchase. Intangible assets and goodwill of approximately GBP12.6 million are also expected to arise on acquisition.
The company has secured new debt facilities with RBS through which it will pay approximately GBP9.5 million of the purchase price. The remaining GBP2.5 million is payable in loan notes bearing interest at 10% a year.
The new banking agreement provides CVS with GBP85 million to support its growth initiatives over the coming years. It includes a fixed term loan of GBP32 million, a revolving credit facility of GBP48 million, and a GBP5 million overdraft facility.
"YourVets is a well-established, high quality operation and we are delighted to welcome the YourVets staff to CVS. This acquisition, together with the recently acquired Townsend Veterinary Practice in Bromsgrove, establishes a significant presence for CVS in the West Midlands. The Essex branches of YourVets are an excellent geographic fit with our existing eight sites in the county," Chief Executive Simon Innes said in a statement.
"The new borrowing facility provides CVS with the flexibility, at a comfortable level of gearing, to fund the ongoing development of the business across multiple organic growth initiatives together with additional acquisition opportunities," he added.
The acquisition is expected to take place on March 30.
Shares in CVS were trading up 0.9% at 504.50 pence Monday morning.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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