12th Jan 2022 10:44
(Alliance News) - Kinovo PLC on Wednesday said it agreed to sell its construction division, DCB Ltd, to MGC Global Ltd for a deferred consideration of GBP5.0 million.
Shares in Kinovo were up 5.5% at 46.40 pence on Wednesday in London but had reached a high of 48.50p earlier in the morning following the announcement.
The London-based property services company is focused on safety and regulatory compliance, land regeneration and energy efficiency. It said the disposal strengthened the foundation of its core business.
The disposal agreement calls for four payments: GBP1.9 million payable on the completion of its DCB's current projects; GBP2.1 million payable on trade settlements relating to current contracts; and two GBP500,000 payments each payable following the achievement of a GBP3.0 million pretax profit target in the year ending March 2023 and the year ending March 2024.
DCB is a building refurbishment and maintenance company focused in the south east of England. For the year that ended March 2021, DCB generated revenue of GBP20.8 million and delivered an operating profit of GBP260,000 and a pretax profit of GBP240,000.
Chief Executive David Bullen said: "I am pleased to have concluded the disposal of DCB. This marks an important step for Kinovo, strengthening the foundation of our core business and enhancing our strategic commitment to focus on regulation, regeneration and renewables. This commitment centres on the non-discretionary areas of compliance and regulatory work that offer long-term contracts, recurring revenues and strong cash generation."
By Heather Rydings; [email protected]
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