Acquisition of Lets Connect IT Solutions Limited

RNS Number : 8469B

Personal Group Holdings PLC

10 March 2014

 



Press Release

10 March 2014

Personal Group Holdings Plc

("Personal Group" or the "Group")

Acquisition of Lets Connect IT Solutions Limited

Personal Group, a leading provider of employee benefits, employee related insurance products and financial services in the UK, is pleased to announce that it has acquired Lets Connect IT Solutions Limited ("Lets Connect") for a total consideration of up to £12 million (the "Acquisition"). The consideration will be satisfied by a £6 million cash payment at completion, followed by an earn out over two years for the remainder of the consideration, dependent on performance. 

Incorporated in 2009, Lets Connect is a leader in the home technology salary sacrifice market, focusing on large enterprises in the private and public sector. This high growth business has grown from £1.7 million in sales in 2010 to £20 million in the 12 months to 31 August 2013 with a pre-tax profit of £0.4 million (£1.1 million had the business been part of Personal Group). The Board of Personal Group view Lets Connect as a well run, entrepreneurial business with considerable growth potential, which is very much in line with Personal Group's own strategy for growth. 

The Acquisition provides Personal Group with an innovative enhancement to its salary sacrifice offering for clients through the addition of exciting technology benefits to its existing employee benefits and reward programmes. Personal Group will have the ability to cross-sell to Lets Connect's blue chip customer base of over 100 companies which have, in total, a potential employee base of 600,000. The Board is confident that Lets Connect's product offering will resonate strongly with Personal Group's existing customers and, given the current separate customer bases of the two companies, there is considerable opportunity for cross-selling.

Dave Cullinane and Stephen Manister, founders and Managing Directors of Lets Connect, will remain with the Company reporting to Ken Rooney, Director and Deputy Chairman of Personal Group, who will dedicate a portion of his time to act as the interface between Lets Connect and Personal Group. Lets Connect will continue to operate from its offices in Bromsgrove and no structural or operational changes to the business are proposed in the near term. 

The Board intends to continue to grow Personal Group through its existing strategy that focuses on organic expansion, developing its technology and identifying compelling acquisitions. Lets Connect is highly complementary to Personal Group's product offering and customer base, and the Group will now have a heightened presence in the public sector through regional county councils and NHS bodies as a result of the Acquisition. This also adds significant private sector clients such as National Grid, Aviva, GE Capital, Grant Thornton and Bank of New York Mellon.

Dave Cullinane and Stephen Manister, founders and Managing Directors of Lets Connect, said:  "Personal Group is a forward looking company and we are hugely excited about the opportunities that this transaction brings. We look forward to working with the Personal Group team and are confident that the Group's range of salary sacrifice products and other benefits will be compelling to our customers and we are similarly excited about offering our products to the Group's existing customers

Mark Scanlon, CEO of Personal Group, commented: "The Board is delighted to announce this Acquisition, which is very much in line with the Group's stated strategy of driving organic growth, focusing on our technology and also identifying acquisitions that will enhance the Group's offering to our clients. Lets Connect is a fast growing business in an exciting space and the Board is confident that the new product offering will resonate with our existing customer base, providing considerable opportunity for cross-selling.  The home technology market is growing significantly and we are excited to be a part of this sector."

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For more information please contact:

Personal Group Holdings Plc
Mark Scanlon, Chief Executive	[phone]
Mike Dugdale, Chief Financial Officer	[phone]

Cenkos Securities Plc
Max Hartley (Nomad) Russell Kerr (Sales)	[phone]

Media enquiries:

Abchurch Communications
Joanne Shears / Quincy Allan / Harriet Rae	[phone]
[e-mail]	www.abchurch-group.com

Notes to editors:

Personal Group Holdings Plc (AIM: PGH) is a leading provider of employee benefits, employee related insurance products and financial services established in 1984 with clients across the UK.

The group primarily provides tailored employee benefits programmes to businesses throughout the UK. These programmes include insurance products such as hospital and convalescence plans; death benefit and income protection plans; lifestyle benefits such as holiday and retail discounts; flexible benefit programmes; a range of tax efficient benefits such as childcare vouchers and employee assistance programmes. The group generates the majority of its revenue through the underwriting of hospital and convalescence plans.

Through its expertise in producing, communicating and implementing successful benefit solutions, the group has helped over 400 leading UK companies recruit, retain and motivate the best people. In total the group provides access to benefits for 1.2 million employees, and clients include 3663, Bidvest, DHL, Spire Healthcare, Northumbrian Water Limited, Pirelli, Starwood Hotels, TNT, UK Mail, Regatta, Road Chef and Vinci Construction.

The group boasts considerable financial strength, with a track record of profitable growth since 1986, as well as a strong pipeline of new business. For the year ended 31 December 2012, the group reported revenue of £27.4 million. With a strong balance sheet and a progressive dividend policy, Personal Group's vision is to be the provider of choice in employee benefits. The group's development to date has been achieved principally through strong organic growth.

Personal Group is headquartered in Milton Keynes, was floated on AIM in 2000 and today employs over 160 people.

For further information, go to www.personal-group.com.

 

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