20 December 2022
Croma Security Solutions Group Plc
("Croma", "the "Company" or the "Group")
Acquisition of Safecell Security Group
Croma Security Solutions Group plc (AIM:CSSG), the security services provider is pleased to announce that its wholly owned subsidiary, CSS Total Security Limited ("Croma Systems"), has acquired Manchester based Safecell Security Group Limited ("Safecell" or the "Acquisition") and its two 100% owned subsidiaries for an initial consideration of £0.45m and deferred cash consideration of c.£0.3m.
· Acquisition of Safecell expected to be immediately earnings enhancing
· Adds a further a security centre, expanding national footprint, to 14 centres across the UK
· Significantly strengthens North West presence and extends ability to service nationwide security clients
· Third acquisition completed in 2022
The consideration comprises a cash payment of £0.45m payable on completion plus a deferred consideration payable on or before 16 March 2023, to the vendors Mr and Mrs Dunne. The deferred cash consideration is the amount equal to the cash plus an amount equal to the debtors less an amount equal to the indebtedness as of the date of completion, which is expected to be in the region of £0.3m
Information on Safecell
Safecell is a well-known and long-standing security business based in Manchester, providing a comprehensive range of services with a particular focus on electronic and physical security together with fire systems, to retail and commercial customers across the North of England. Safecell's locksmith business operates from premises in Bury (North Manchester).
For the period January to November 2022, Safecell recorded revenue of £0.85m with full year projection of £0.93m (including re-occurring revenue of £0.4 million) and a profit before tax of £0.19m.
As of November 2022, Safecell had net assets of £0.39m.
Benefits of the Acquisition
Croma's strategy has been and remains to create a nationwide network of Croma Security centres. The Acquisition will extend the geographic reach of the Group and through its Bury site provide a base from which Croma can better service, support and expand existing relationships with clients that have operations in the area. The Bury systems business will operate alongside our successful acquisition last year of Safeguard (N/W) Ltd in Warrington.
Croma will immediately benefit from being able to provide in-house services to clients in the Manchester and surrounding areas, many of whom are part of national security accounts, currently these services are outsourced to sub-contractors. Going forward, these will now be serviced via the Safecell team along with the potential expansion of products and services that Croma will bring to the Safecell clients. Mr Mick Dunne the highly experienced principal of the business will remain as part of the Croma team and operate as area manager.
Commenting on the Acquisition, Roberto Fiorentino, CEO of Croma, said: "Safecell is an excellent business and under Mick Dunne it has built a strong reputation in the North West security market. I am delighted Mick will be staying with the Group and I look forward to working alongside him, as we build our presence further across this important region. As recently stated, alongside the proposed sale of our manned guarding business, Vigilant, we are re-focusing our Company on our higher margin security solutions businesses alongside establishing a national network of security centres. After a slower period during the pandemic, opportunities such as Safecell are emerging which is a natural fit with our objectives, and we are hopeful of completing similar earnings enhancing acquisitions in 2023."
This announcement contains inside information for the purposes of Article 7 of the UK version of Regulation (EU) No 596/2014 which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.
For further information visit www.cssgplc.com or contact:
Croma Security Solutions Group Plc Tel: +44 148 956 6100
Roberto Fiorentino (CEO)
WH Ireland Limited Tel: +44 (0)207 220 1666
(Nominated Adviser and Broker)
Novella Tel: +44 (0)203 151 7008