Styles & Wood has acquired the entire issued share capital of specialist critical facilities and data centre services provider Keysource Ltd for an initial consideration of about £2.0m to be satisfied in cash and shares.
An additional payment will be made to reflect any excess working capital over and above the ongoing requirements of the business.
The Board expects this to amount to £2.5m. Such payment will be covered by the cash inherited in Keysource at the completion date. The Board envisages the Acquisition to be earnings enhancing in FY 2017.
- Initial consideration to be satisfied by a cash payment of £1.0 million and the issue of 257,365 new ordinary shares to the vendors of Keysource, who will remain with the business;
- Potential further deferred consideration of up to £5.0 million, to be satisfied in cash and shares, subject to the achievement of certain financial performance criteria over the three year period ending 31 December 2018;
- Acquisition in line with Styles&Wood's strategic focus on diversifying its service offering across key sectors;
- Enhances the Group's service line capabilities in technologies and critical facilities including data centres;
- Provides new opportunities to broaden work streams to both existing and new customers;
- Overall market for data centres is forecast to reach over £1.1bn by the end of 2020, representing annual growth of 3-4%;
- Acquisition funded from the Group's existing financial resources; and
- Expected to be earnings enhancing in FY 2017.