Acquisition

RNS Number : 4080C

K3 Business Technology Group PLC

07 March 2011

 



AIM: KBT

 K3 Business Technology Group plc

("K3" or "the Group")

Announces

Acquisition of Sense Enterprise Solutions Ltd

K3, which supplies and supports Enterprise Resource Planning ("ERP") software to the supply chain industry, is pleased to announce the acquisition of Sense Enterprise Solutions Ltd ("Sense"), the provider of Microsoft Dynamics AX ERP solutions to the manufacturing and distribution markets. The total initial consideration for the acquisition is £1.2 million payable in cash on completion. In addition, a payment of £350,000 is being made in respect of surplus cash in the business at completion. Further consideration of up to £0.9m is payable dependent on certain performance criteria.  

The acquisition brings critical mass and additional skills to K3's existing AX business, as well as adding approximately 40 customers. Following the acquisition, K3 believes its AX business unit will be the largest AX provider in the UK. K3 also sees excellent opportunities to cross-sell its products and services to Sense's existing customer base.

For the year to 31 December 2010, Sense generated sales of £1.8 million, of which approximately 33% are recurring revenues, and an underlying operating profit of £0.3 million.

The acquisition also expands K3's library of Intellectual Property and brings K3 exclusive UK membership to AxPact, an international network of 27 AX partners which collaborate on multi-national projects. AxPact accounts for over 10% of all AX projects worldwide and to date, this has been a useful source of new business leads for Sense.

 Andy Makeham, Chief Executive of K3, said,

"I am delighted to announce the acquisition of Sense. Microsoft Dynamics AX is strategically important to K3 as a fast growing market. Sense was one of the first AX partners in the UK and has established a strong reputation in the marketplace. It is also the only member of AxPact in the UK, generating significant new business wins, and this will further support the increasingly global nature of K3's implementations.

The acquisition provides K3 with additional skills and a substantial user base that will significantly improve the profitability of the Group's own AX unit. It also represents further progress on our strategy to build a library of Intellectual Property, providing superior margins and competitive advantage."

Enquiries

K3 Business Technology Group plc	Andy Makeham, Chief Executive	Today: 020 3178 6378
	David Bolton, Finance Director	Thereafter: 0161 876 4498
Canaccord Genuity Limited (NOMAD)	Simon Bridges / Kit Stephenson	T: 020 7050 6500
Biddicks	Katie Tzouliadis / Sophie Lane	T: 020 3178 6378

 

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