Thursday 21st June 2018
|Text too small?|
Gentrack Group said it agreed to acquire Evolve Analytics, an energy data analysis software and services provider, for 23 million British pounds, or $44.2 million, bolstering its leading position for utility billing and customer information systems in the UK.
The acquisition, for which settlement is expected on June 29, will be funded through an extension of Gentrack’s debt facilities with ASB Bank, raising it by $47 million from the current $50.5 million, the Auckland-based company said in a statement.
On the basis that the acquisition is debt funded, the Evolve deal will be “low single digit earnings per share accretive” in the first full year, fiscal 2019, and drive increased growth in future earnings, according to Gentrack.
Evolve’s senior management, including managing director Alan Duggan, will join the Gentrack UK management team, the company said.
Gentrack has been expanding its business, having last year acquired UK billing and customer information systems firm Junifer Systems for $74.6 million and European airport software developers Blip Systems and CA Plus for about $20.3 million, secured major contracts with two of the UK's 'Big 6' energy suppliers and is working on new projects across its divisions.
Customers of Evolve, which specialises in the identification and correction of settlement and billing errors as well as the accuracy of standing data, include three of the 'Big 6' energy suppliers in the UK, Gentrack said.
Evolve, which captures data for more than 17 million meter points, is forecast to generate revenue of 3.1 million pounds in the year ending April 30, 2019, of which 58 percent will be recurring revenue, while margins are predicted to top 50 percent, Gentrack said.
“The combined UK business is well positioned to provide highly innovative, value enhancing solutions to UK energy and water utilities and provides a strong base for expansion into new markets,” Gentrack chair John Clifford said in the statement.
Indeed, “there is an opportunity to extend this new offering to the Australian and New Zealand markets,” Gentrack chief executive Ian Black said in the statement. The company has more than 200 customers in 36 countries.
Gentrack plans to undertake a fully underwritten pro-rata renounceable entitlement offer to reduce its debt, which will provide flexibility to support future acquisition and growth opportunities, it said. Gentrack has appointed Deutsche Craigs and UBS New Zealand to manage any offer.
Shares of Gentrack recently traded 1.8 percent higher at $7.42. The stock has gained more than 50 percent in the past year.
No comments yet
MARKET CLOSE: NZ shares follow Asian markets higher on renewed hopes for China-US resolution
Housing Ministry head hints he acted against departed KiwiBuild head Stephen Barclay
NZ dollar heading for 1% weekly slide as outlook weakens
Currency frozen in multi-million dollar Cryptopia theft
NZ manufacturing activity hits highest level since April
Tilt affirms guidance; Dec qtr production misses long-term expectations
NZ dollar extends slide as Philly Fed lifts sentiment in US
January 18th Morning Report
MARKET CLOSE: NZ shares get further lift from positive offshore markets
NZ dollar extends decline amid mixed data