1st Nov 2005 07:02
Blueheath Holdings PLC01 November 2005 FOR IMMEDIATE RELEASE 1 November 2005 Blueheath Holdings plc Acquisition of AC Ward & Son Limited Blueheath, the national delivered wholesaler using sophisticated, proprietarytechnology to offer a substantial cost advantage over established players in the£16.4bn grocery wholesale sector, is today pleased to announce the acquisitionof AC Ward & Son Limited ("ACW") for up to £3.0 million in cash (the "Acquisition"). ACW is a traditional delivered wholesale business to the grocery wholesalemarket. It now operates from a single warehouse depot located in Thurrock in theSouth East of England. For the ten months to 31 October 2005, ACW is expected toreport an annualised turnover of £55m, and net assets of £0.7m. The transactionexcludes a small cash and carry business based in Sudbury. Of the cash consideration of up to £3.0m, a total of £1.0m is conditional on thesales performance of the business in the period immediately following theacquisition. James Ward (34), formerly managing director of A C Ward & Son will be joiningthe business to support the integration of the ACW business and assist withfuture business development. Rationale for and benefits of, the ACW Acquisition: • Following the encouraging progress with the integration of CTM Wholesale Limited, acquired by Blueheath in April this year, ACW represents a further opportunity to supplement the organic growth of the Company through the acquisition of a traditional regional delivered wholesaler. • Plans are in place for the integration of the business into the Blueheath Group's current operation with the associated cost savings falling in the 2006/07 financial year. • As with CTM, the Directors anticipate that the enlarged group will be able to achieve improved operating margins through combining buying volumes, the application of Blueheath's technology and business processes to the ACW operation, and the integration of central overheads. • ACW currently operates with stock levels of approximately 20-25 days. By utilising Blueheath's sophisticated proprietary technology, the Directors anticipate that this can be significantly reduced towards the Company's normal operating levels, thereby releasing significant working capital. • ACW supplies delivered wholesale to around 1,000 outlets in the South East, providing a complementary fit with Blueheath's existing customer network. Commenting on the acquisition, Douglas Gurr, Chief Executive of Blueheath said: "We are delighted with the acquisition of ACW today. This is an important partof our growth strategy and coupled with the encouraging progress on theintegration of CTM we are confident that Blueheath is in a good position fromwhich to go forward." Blueheath Holdings plcDouglas Gurr, Chief Executive Tel: 020 7689 2455Simon Mindham, Finance Director Tel: 020 7689 2464 Buchanan Communications Tel: 020 7466 5000Mark Edwards / Nicola Cronk / James Strong email: [email protected] Evolution Securities Tel: 020 7071 4300Michael Brennan / Bobbie Hilliam Notes to editors:Please see today's Interim results for further information. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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