8th Oct 2013 08:29
LONDON (Alliance News) - Trakm8 Holdings PLC Monday said it would acquire BOX Telematics Ltd for GBP3.5 million in cash, paid for partly from a new GBP2.5 million debt facility, partly from cash reserves, and the rest by issuing shares to raise GBP720,000.
The company, which makes GPRS hardware and software for vehicle tracing and security, said the deal will give it more manufacturing fire-power, increase its customer base and offer cross-selling opportunities. It also sees "substantial" synergy opportunities.
It said the existing customers generate strong recurring revenues and it is encouraged by the sales pipeline for the current financial year.
BOX provides vehicle fleet management systems.
"The acquisition of BOX is a significant milestone for Trakm8, bringing strong financial and strategic benefits as it will enable us to exploit the growing demand for vehicle telematics in a fragmented market place," Trakm8 Chief Executive John Watkins said in a statement.
Trakm8 said its share placing will raise GBP1.35 million in total so that it has additional working capital left after paying for the deal, which is a reverse takeover and therefore needs shareholder approval.
Trakm8 shares were up 49% at 31.38 pence Tuesday morning, the biggest rise on the London market.
The company said its expects shares in the enlarged company to start trading on AIM October 25.
By Steve McGrath; [email protected]; @stevemcgrath1
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