Acquisition

RNS Number : 8330D

NCC Group PLC

29 March 2011

 



29 March 2011

NCC Group plc

Acquisition of US-based escrow provider for up to $9.5m

NCC Group plc (LSE: NCC, "NCC Group" or "the Group") the international, independent provider of Escrow and Assurance has acquired Escrow Associates LLC ("Escrow Associates"), a US-based software escrow company, for a maximum consideration of up to $9.5m (£5.9m) in cash.

Escrow Associates provides independent escrow solutions to approximately 1,000 clients predominately located in North America. This earnings enhancing acquisition will substantially increase the Group's scale in the US escrow market and widens its international presence as many of Escrow Associates' clients are multi-national corporates. 

The initial consideration on completion is $8.1m, with a further performance related payment of up to $1.4m. The latter is expected to be paid in July 2012.

For the year ended 31 December 2010, Escrow Associates' revenue totalled $2.2m, including approximately $2.0m of annual recurring revenues.  Earnings before interest and tax were $0.8m.  The gross assets on 31 December 2010 were $0.6m.

Escrow Associates, which was established in 2002, is based in Atlanta.  It currently employs 10 people and has a client base across all sectors of the market.

The operation will be managed within NCC Group's Escrow division with the operational management team of Escrow Associates staying with the business.  The Group expects to benefit from their knowledge and experience of the North American escrow market.  Their involvement will provide the Group with the potential to develop existing accounts and offer clients an improved account management service, particularly on the east coast of America.

Escrow Associates' policy of maintaining a neutral stance favouring neither licensees nor suppliers and providing mandatory testing of escrow deposits complements NCC Group's independent status and position as a 'trusted advisor' to its clients. The company will trade as "Escrow Associates, an NCC Group Company."

NCC Group will publish its Interim Management Statement on 19 April 2011. 

Rob Cotton, NCC Group Chief Executive, said:

"Our stated strategy is to develop our international presence in both businesses with a combination of organic and acquisitive growth.

"This very exciting, earnings enhancing acquisition is another important step in strengthening our world leading position and particularly in North American - both in terms of scale and geographical coverage.  It increases the number of software applications and the number of multi-national businesses protected by our escrow solutions.

"Research shows that whilst 97% of organisations depend on business-critical software applications, only 18% protect all of these with escrow solutions. We are increasingly well placed to exploit this market opportunity internationally."

Enquiries:

NCC Group	0161 209 5200
Rob Cotton - Chief Executive
College Hill	020 7457 2020
Adrian Duffield/Rozi Morris

 

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