Acquisition of Classic Education Limited

Servoca plc

("Servoca" or "the Group")

Acquisition of Classic Education Limited

Servoca, the AIM listed specialist recruitment and outsourcing solutions provider, is pleased to announce the acquisition of Classic Education Limited ("Classic Education"). The acquisition is to be funded from existing cash resources and debt facilities and the initial consideration is £1.2m.

In addition, Servoca will pay deferred consideration of up to £1.9m, subject to Classic Education meeting certain profit targets for the two years following acquisition.

Information on Classic Education

Classic Education has been established for 11 years and holds a strong reputation for the delivery of quality Education Recruitment services into its local markets. The business operates from a single office in Gravesend, Kent. In the year ended 31 March 2016 unaudited pre-tax profit was just under £0.6m. In the opinion of the Board, the adjusted sustainable pre-tax profit at constant gross profit levels is circa £0.4m to £0.5m. At 31 March 2016, unaudited management accounts showed Classic Education had net assets of £0.4m.

The board of Servoca expect the acquisition to be earnings enhancing in the year to 30 September 2017 with minimal impact in the current year. Classic Education is a bolt-on to the Education Recruitment business in a geographic area with high levels of demand but where Servoca does not currently hold a local presence.

Andy Church, CEO of Servoca commented,

"We are delighted that Classic Education is now part of Servoca. This acquisition complements our existing branch network in education and gives us a local presence in the Kent and South London market, an area with significant demand for education recruitment services. The acquisition of a long-established local provider in this area increases our national branch network coverage. In total we now have 15 UK locations and one overseas office from which we service local schools. We look forward to working with the staff and management that have helped build the business into one of the leading providers in the area."

Enquiries