Acquisition of Green Power Hire Limited

Speedy Hire PLC

10 October 2023

 

 

 10 October 2023

Speedy Hire Plc

("Speedy", "the Company" or the "Group")

Acquisition of Green Power Hire Limited

Positions Speedy as a leading provider of Battery Storage Units

Speedy Hire Plc, the UK and Ireland's leading provider of tools, specialist equipment and services, today announces the acquisition of the entire issued share capital of sustainable power solutions specialist, Green Power Hire Limited ("GPH"), for an enterprise value of £20.2m.  The total consideration, which was funded from the Company's existing debt facilities, represented £10m of equity value and assumed debt of £10.2m which was settled at completion. Speedy acquired GPH from its principal shareholder, Russell's (Kirbymoorside) Limited, and four other shareholders.

GPH is a recognised industry leading owner and supplier of Battery Storage Units ("BSU") to the UK rental market, mainly to the construction sector. GPH's BSUs, with their market leading digital capability, enable customers to achieve both financial and environmental savings compared to alternative systems available.

Speedy continues to experience strong demand from its current and potential new customers for eco products and sustainable power solutions, and an increasing number of tenders specify BSUs. The acquisition positions the Group as a market leader in a key growth segment, providing it with the critical mass to meet demand from its customers and enabling it to retain more of the margin from directly hiring to its customers. To date GPH's BSU assets have been provided by Speedy to its end customers on a re-hire basis as part of Speedy's Customer Solutions division.

The acquisition of GPH will enable the continuing rapid development of GPH's business, with access to Speedy's broad customer base, asset rental expertise, data and AI capabilities and investment in expanding the number of BSU's.  GPH will also benefit from operational and scale efficiencies as part of the Speedy Group. Mark Chamberlain, Director and one of the vendor shareholders of GPH, joined Speedy at completion as an integral part of the ongoing management team.

The acquisition is expected to be accretive to underlying earnings in the first full year of ownership, with ROCE¹ also exceeding the Group's cost of capital. The Group's balance sheet remains strong, with pro-forma net debt² remaining at the top end of the mid-term leverage guidance of 1.0 - 1.5x EBITDA².

In July 2023, the business and assets subject to the transaction were hived down from Russell's (Kirbymoorside) Limited into GPH.  For the year ended 31 October 2022, GPH generated unaudited revenues of £0.4m and a loss before tax of £0.2m. The business has grown rapidly and for the ten months ended 31 August 2023, unaudited revenues were £5.9m, the business was profitable, and it had unaudited gross assets of £12.5m.

Today the Group has announced a trading update for the half year to 30 September 2023.

Commenting on the acquisition, Dan Evans, Chief Executive, said:

"The acquisition of Green Power Hire is further evidence of our Velocity strategy in action, strengthening our market leadership in combining product innovation and sustainability, and positioning Speedy well in a high growth segment of the market.

"Alongside investments such as our partnership with Niftylift and our proposed JV with AFC Energy, the acquisition progresses the sustainable and technological evolution of the sectors we operate in, supports our ambitious plan to become a net zero business by 2040 and will deliver long term benefits to our customers, our people and our investors."

Enquiries:

Speedy Hire Plc Dan Evans, Chief Executive Paul Rayner, Chief Financial Officer	Tel: [phone]
MHP Oliver Hughes Katie Hunt	Tel: [phone]

Notes:

Explanatory notes:

¹ Return on Capital Employed: Profit before tax, interest, amortisation and exceptional items divided by the average capital employed (where capital employed equals shareholders' funds and net debt²), for the last 12 months.  

² This metric excludes the impact of IFRS 16

Inside Information:  This announcement contains inside information for the purposes of article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018.  Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.

Notes to Editors: Founded in 1977, Speedy is the UK's leading provider of tools and equipment hire services to a wide range of customers in the construction, infrastructure, industrial, and support services markets, as well as to local trade, and retail. The Group provides complementary support services through the provision of training, asset management and compliance services. Speedy is certified nationally to ISO50001, ISO9001, ISO14001, ISO27001 and ISO45001 and holds ISO 17020 accreditation within our Lloyds British National Contracts business.  The Group operates from c.180 fixed sites and selected B&Q stores across the UK and Ireland together with a number of on-site facilities at client locations and through a joint venture in Kazakhstan.

 

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