Acquisition of t-mac Technologies

21 April 2015

Utilitywise plc

("Utilitywise", "the Company" or "the Group")

Acquisition of t-mac Technologies ("t-mac")

§ Acquisition of t-mac Technologies (t-mac) for initial consideration of £10m

§ Strong growth prospects in a very fragmented market

§ Broadens group service offering into energy monitoring and control

§ t-mac will deepen group's client relationships and enhance overall growth prospects

Utilitywise PLC (AIM:UTW), a leading independent utility cost management consultancy, is pleased to announce the acquisition of the entire issued share capital of t-mac Technologies Ltd for an initial consideration of £10m. The acquisition is in line with the Company's stated strategy of broadening its service offering and, in particular, expanding into energy management systems.

t-mac's modern, cloud-based technology provides Utilitywise with the assets and skills to offer new value-added subscription services to its customers as part of a complete Utility Management Plan which covers Procurement, Management, Monitoring, and Reduction of electricity, gas and water. The acquisition will allow Utilitywise to protect and deepen its customer relationships whilst providing an opportunity to further upsell to our current customer base.

Through its own proprietary technology and software, t-mac provides business energy management systems (BeMS) which enable clients to monitor and reduce their utility consumption, make savings and helping them comply with Government legislation. Founded in 2004 and based in Chesterfield with 28 employees, t-mac services both SME and I&C (industrial and commercial) customers in the retail, education, manufacturing, transport, and leisure sectors. t-mac has significant market experience and a strong reputation across market segments where Utilitywise is already successful, and where demand for energy management solutions is buoyant.

The initial consideration payable is GBP £10m, £6.25m in cash and 1,782,319 new ordinary shares in Utilitywise at an issue price of 210.4p per new ordinary share, being the average closing mid-market price of a Utilitywise share in the 30 trading days to 17 April 2015 (the "Initial Consideration Shares"). The Initial Consideration Shares are subject to a 24 month lock up, save that after 12 months up to 50% of the Initial Consideration Shares can be sold.

Up to a further GBP £12 million will become payable once earn out accounts have been finalised, in cash (70%) and new Utilitywise shares based upon six times EBITDA above a hurdle for the 12 month periods ending on the first and second anniversary of completion. For the year to 31 March 2015 t-mac reported revenue of GBP £3.6m and EBITDA of GBP £0.3m.

The initial cash consideration is being funded by a new £25 million revolving credit facility with Royal Bank of Scotland plc of which £13 million will be immediately drawn to fund the Initial Cash Consideration and to refinance the Group's existing facilities of £6 million. 

Application has been made for the 1,782,319 new ordinary shares of 0.1p each in Utilitywise ("Ordinary Shares") to be admitted to trading on AIM ("Admission") with dealings are expected to commence on 27April 2015. The new Ordinary Shares rank pari passu with the Company's existing Ordinary Shares.

The total number of Ordinary Shares in issue following Admission will be 76,485,653. Accordingly, the figure of 76,485,653 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company under the FCA's Disclosure and Transparency Rules.

t-mac is run by Lisa Gingell and Jonathan Wilkinson, who are taking a material proportion of their consideration in Utilitywise equity.

Utilitywise CEO, Geoff Thompson commented:

"The market for BeMS is growing and modern cloud-based Software as a Service (SaaS) platforms, such as t-mac, provide significant cost advantages over traditional solutions which require intensive capital investment and offer long term ROIs.

"We know that our customers are increasingly looking for rapid impact, cost-effective services that provide them with more control over their electricity, gas and water usage, to help drive their business efficiency agenda as well as mitigate against future price volatility. This acquisition continues to expand our broad range of services that address the breadth of our customers' energy needs.

"The acquisition of t-mac Technologies will play a major role in helping us to deliver significant added-value services and develop closer, more profitable relationships with existing customers, as well as supporting our new customer acquisition strategy".

For further information:

About Utilitywise

Utilitywise is a leading independent utility cost management consultancy based in North Tyneside. The Group has established trading relationships with a number of major UK energy suppliers and provides services to its customers designed to assist them in achieving better value out of their energy contracts, reduced energy consumption and lower carbon footprint.

Businesses large and small rely on Utilitywise for their energy management needs. Clients range in size from high street shops to multinationals with thousands of sites and cover the whole of the UK. In total, Utilitywise has over c23,000 customers.

Utilitywise is a UK company quoted on the AIM market of the London Stock Exchange. For more information, please visit www.utilitywise.com.