Water Intelligence PLC Reacquisition of Portland (3465D)
October 09 2018 - 1:00AM
UK Regulatory
TIDMWATR
RNS Number : 3465D
Water Intelligence PLC
09 October 2018
Water Intelligence Plc
Reacquisition of Portland, Oregon Territory
Water Intelligence plc (the "Company" or the "Group"), a leading
provider of minimally-invasive leak detection and remediation
services for residential, commercial and municipal customers, is
pleased to announce the reacquisition of the territories of
Portland, Oregon and certain parts of Washington State (the
"Portland Region") from a current franchise holder within the
Group's American Leak Detection subsidiary ("ALD"). That franchise
holder will remain in the ALD franchise system and continue to grow
and pay royalties on its significant remaining operations in
southern Oregon.
For full year 2017, the Portland Region generated approximately
$1.05 million of revenue and $0.35 million of pre-tax profits. The
Portland Region is on pace to exceed its 2017 numbers for both
revenue and profits for full year 2018. The transaction is expected
to be immediately accretive to earnings. Tangible assets acquired
are approximately $0.2 million. The purchase price is $1.3 million
in cash to be paid from existing resources.
Portland is one of the bigger cities in the northwest United
States. As a strategic matter, the acquisition enables ALD
corporate operations to set up a regional office to support the
growth of its franchisees in the northwest United States. In doing
so, ALD will now have corporate-operated locations across the
United States: northeast, southeast, central, southwest and
northwest. These regional centers help execute ALD's national
business-to-business channels, such as insurance and property
management, and reinforce national brand management.
The northwest region for ALD is also notable in that franchisees
located there execute a significant amount of municipal leak
detection work in addition to traditional service offerings for
residential and commercial customers. As a strategic matter, ALD's
UK-based sister company - Water Intelligence International ("WII")
- specializes in municipal offerings and is looking to work with
ALD franchisees to increase the amount of municipal sales for the
entire Group. The Portland Region, now offers a corporate base of
operations to further sales of WII municipal solutions to US
franchisees and their customers. Year-to-date, WII has already
increased its work with select ALD franchises and corporate
locations in the US and Australia to expand their respective
municipal sales. The reacquisition of the Portland Region now
enables the Group to accelerate such cross-sales opportunities.
Executive Chairman, Patrick DeSouza, commented:
"We continue to deliver our announced strategic plan. We are
excited by the Portland Region's opportunities to unlock synergies
for our franchisees and corporate operations. Much like our
sizeable Louisville transaction earlier this year that now
integrates operations in the Midwest US, this transaction has a
similar strategic profile: (i) integration of ALD corporate and
franchise operations in the Northwest US to accelerate sales growth
derived from national channels such as insurance and property
management and (ii) acceleration of our UK-based municipal business
with new US sales opportunities generated by ALD's existing
reputation in communities for minimally invasive leak detection
solutions. Hence we are layering-in residential, commercial and
municipal sales for the Group by lowering execution trade-offs.
Finally, we are pleased that, like Louisville, there is a strong
and growing base of revenue and profits in the acquired territory
from which to build our broader business."
Enquiries:
Water Intelligence plc Tel: +1 203 654 5426
Patrick DeSouza, Executive Chairman
finnCap Ltd Tel: +44 (0) 207 220
Julian Blunt/Giles Rolls, corporate finance 0500
Camille Gochez, corporate broking
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014
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END
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