1st Oct 2013 09:10
LONDON (Alliance News) - Iomart PLC Tuesday bought a cloud data backup and disaster recovery company, said its chief Executive will sell a stake, and reported that current trading remains strong, with revenues and profits in the first half of its current financial year expected to be substantially above last year as the market is expecting.
The company said it has bought Backup Technology Holdings Ltd for GBP23 million, comprising GBP17.5 million in cash, GBP3.5 million in new shares, and a GBP2 million cash payment deferred until January 31, 2014.
Leeds-based Backup Technology had revenues of GBP5.2 million in 2012 and earnings before interest, tax depreciation and amortization of GBP2.4 million. Its customers include Siemens, British Red Cross, Lloyds Register, Suzuki and Pernod Ricard, as well as Liverpool and Everton football clubs.
Iomart will pay the cash part of the payment from a new GBP35 million debt package from the Bank of Scotland, made up of a GBP15 million loan and a GBP20 million revolving credit facility. Iomart said it has already drawn down GBP32.5 million of the facility, using GBP14 million to repay existing debt facilities and the rest to fund the acquisition.
In a trading statement, Iomart said trading in the first half of the financial year had remained strong, with revenues and profits substantially ahead of last year and in line with current market expectations.
It will release its results for the six months to end-September on December 10.
"Customer demand for iomart's services remains strong and growing, as the market increasingly shifts toward the provision of products and services over the internet. Strong market drivers, combined with high levels of visibility and customer renewals, leaves the Board optimistic for continued success," the company said in its statement.
"The addition of BTL to the Group will further broaden and diversify our cloud-based offerings and enhance our position in the market. I look forward to the second half of the year and remain very confident in the growth prospects of the business," Chief Executive Angus MacSween said.
Separately, Iomart said that directors MacSween, Richard Logan and Sarah Haran had decided to sell a total of GBP11.8 million shares in the company via an accelerated bookbuilding placing.
MacSween will sell GBP10 million shares to rebalance his personal portfolio and take advantage of a tax relief scheme for entrepreneurs, the company said. He has pledged not to sell any more shares before the company reports results for the financial year ending March 2015.
Iomart shares were down 3% at 281.41 pence Tuesday.
By Steve McGrath; [email protected]; @stevemcgrath1
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