React Group PLC Update on acquisition of Fidelis (2965Y)
May 12 2021 - 1:00AM
UK Regulatory
TIDMREAT
RNS Number : 2965Y
React Group PLC
12 May 2021
12 May 2021
REACT Group plc
("REACT" or the "Group")
Update on acquisition of Fidelis Contract Services Ltd
REACT (AIM: REAT.L), the leading specialist cleaning, hygiene,
and decontamination company, is pleased to announce an update in
respect of the acquisition of Fidelis Contract Services Ltd
("Fidelis"), details of which were announced on 29 March 2021.
The acquisition of Fidelis has been immediately earnings
enhancing for REACT and has been an important step in the Group's
stated growth strategy. The Board of REACT is delighted with the
smooth integration of the business into the Group with the two
management teams working well together to deliver quality services
to customers.
REACT is pleased to announce that, based on unaudited management
accounts prepared by Fidelis for the year ended 31 March 2021 ("FY
2021"), Fidelis has generated revenue of GBP4.87 million, up 48% on
the prior year (FY 2020: GBP3.30m), gross profit up 45% at GBP1.23
million (FY 2020: GBP0.85m) and EBITDA up 112% at GBP0.56 million
(FY 2020: GBP0.27 million).
As such, the Board of REACT anticipates GBP500,000 of the first
deferred consideration will be payable in cash to the vendors of
Fidelis in October 2021. The Board also anticipates a further
GBP200,000 will be due in respect of the first deferred
consideration, with payment scheduled in four equal instalments
between 30 September 2022 and 29 March 2024. REACT is well
positioned to make these payments from within its existing
resources.
The Fidelis financials and the deferred consideration figures
remain subject to, inter alia, completion of audit and finalisation
of the completion accounts. As such, the first deferred
consideration payments remain subject to potential change but are
capped at a total of GBP700,000. It is anticipated that the audit
and completion accounts will be finalised in July 2021 to enable
the first deferred payment to be made in October 2021.
As the acquisition of Fidelis completed on 26 March 2021, the
performance of Fidelis will not have any impact on REACT's results
for six months ended 31 March 2021, to be announced by 30 June
2021. The Board of REACT is pleased with the performance of Fidelis
in the short period since being part of the Group and, as such, the
Board continues to be confident of the positive impact Fidelis will
have on the Group for the remainder of the current financial year
and beyond.
As previously announced, the total consideration payable for
Fidelis was based on 4.75 times EBITDA in the financial year ending
31 March 2022 ("FY 2022") capped at GBP4.75m (on a cash free, debt
free basis with normalised working capital).
Further details on the terms and the structure of the
acquisition are detailed in the announcement released by REACT on
29 March 2021.
For more information:
REACT Group plc
Mark Braund, Chairman Tel: +44 (0) 798 222
Shaun Doak, Chief Executive Officer 0001
Andrea Pankhurst, Chief Financial Officer
Allenby Capital Limited
(Nominated Adviser and Broker)
Nick Athanas / Liz Kirchner (Corporate Tel: +44 (0) 203 328
Finance) 5656
Amrit Nahal / Tony Quirke (Sales &
Corporate Broking)
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
UPDGPUQGAUPGPUG
(END) Dow Jones Newswires
May 12, 2021 02:00 ET (06:00 GMT)
React (LSE:REAT)
Historical Stock Chart
From Mar 2024 to Apr 2024
React (LSE:REAT)
Historical Stock Chart
From Apr 2023 to Apr 2024