Acquisition of SA Gas Engineers Limited

For immediate release 3 March 2015

Energy Assets Group plc

("Energy Assets" or the "Group")

Acquisition of SA Gas Engineers Limited

Energy Assets Group plc (LSE: EAS.L), the largest independent provider of industrial and commercial (I&C) gas metering services in the UK[1], is pleased to announce that it has acquired the entire issued share capital of SA Gas Engineers Limited (SA Gas), an accredited meter asset manager and a leading UK expert in complex I&C gas engineering and specialist siteworks projects.

Established in 1992, SA Gas has developed a strong brand and a reputation in the market as a highly respected specialist, providing services both upstream and downstream of the customer's meter. This acquisition significantly extends the Group's operational capability as well as expanding the range of increasingly sophisticated services provided to link the gas network to the customer's usage point. The acquisition will thus enable the Group to increase the market share of its existing Siteworks division and provide a broader service offering to customers.

Based in Nottinghamshire, SA Gas has a wealth of experience and expertise in all types of I&C gas related engineering projects. The highly qualified team of specialist engineers and technicians, all of whom will transfer with the business, has a reputation for delivering innovative, efficient and cost-effective solutions to a wide range of the UK's leading companies. In the year to 31 July 2014 SA Gas generated turnover of £2.9m.

The transaction consideration comprises an initial cash payment of £3.4m, 222,108 shares in Energy Assets Group plc, with a market value of £1m, which are subject to the sellers of SA Gas remaining with the Group during a restrictive period of two years, an earnout consideration of up to £0.5m contingent on the future profitability of SA Gas and an amount for the completion cash balance of SA Gas which will be determined on the basis of completion accounts. The cash consideration is also subject to post-completion adjustment by reference to the actual completion working capital of SA Gas. Cash consideration will be funded from a combination of cash reserves and existing loan facilities.

The acquisition is in line with Energy Assets' established strategy of pursuing attractive opportunities and making selective acquisitions which add value to the Group. The Energy Assets directors are confident that, following integration into the Group, the SA Gas business will be earnings enhancing in the new financial year commencing on 1 April 2015. 

"Energy Assets has built a strong relationship with SA Gas over a number of years, working together on several major projects, and I am delighted to now welcome them fully into the Group in an acquisition that represents another significant step in our growth strategy. The strong SA Gas brand and reputation, along with the wealth of acquired expertise, will complement our existing business resulting in further improvements to the service offering and value delivered to our customers."

Karl Simmons, Managing Director of SA Gas, said:

"SA Gas has been delivering high quality, innovative I&C gas infrastructure solutions to our customers for many years and has gained an enviable reputation within the industry. Our ethos revolves around quality of service and customer satisfaction which has been the foundation of our growth, creating a substantial and loyal customer base.

We have worked with Energy Assets for a number of years and have developed close working relationships between our respective businesses. We are delighted to now have the opportunity to grow the business further by being part of a wider Group. This represents a major milestone in the development of SA Gas and gives us access to the support we need to further develop the business. By utilising our own in-house expertise alongside Energy Assets resources and specialists we can look forward to further success whilst ensuring continued customer satisfaction. We firmly believe that this opportunity offers an exciting future for us all."

Enquiries

For further information visit www.energyassets.co.uk or contact:

Notes to Editors:

Energy Assets

Energy Assets provides metering and related services in the I&C segment of the UK utility market and is the largest independent provider of I&C gas metering services in the UK, by number of assets owned and managed. The Group offers utility suppliers and end-user consumers of energy a broad spectrum of metering services from the provision and management of new and replacement meters through its Meter Asset Management (MAM)/Meter Operator (MOP) divisions to the procurement and project management of related utility infrastructure works and the collection and provision of energy consumption data through the Group's Siteworks and Automated Meter Reading (AMR) divisions.

Energy Assets (EAS) is listed on the Main Market of the London Stock Exchange.

SA Gas Engineers

SA Gas Engineers is a leading provider of complete gas engineering and pipework solutions for a diverse range of clients. The business has grown since 1992 into one of the foremost gas services companies in the UK with services ranging from fully managed gas installations and live connections, to gas pipework modifications and in-depth gas maintenance projects. For further information: www.sagaseng.co.uk