A Lancashire-headquartered listed energy company has completed a pair of acquisitions.
Inspired Energy has snapped up Businesswise Solutions and General Energy Management (GEM) using funds from its £31.3m placing and open offer which was completed in July 2020.
Businesswise is an energy consultant based in Nelson, Lancashire, which primarily provides assurance services and incremental optimisation services to its diverse corporate customer base across a broad range of sectors.
The company has an order book of about £10m and more than 340 customers, increasing the group's customer base by c.10%.
Businesswise has 43 employees, who will continue to operate from its existing premises, while its management team, including its founder and chief executive, will remain with the enlarged group.
For the financial year ended March 31, 2020, Businesswise delivered revenues of £3.79m, an EBITDA of £1.3m and profit before tax of £1.15m.
Because of the economic uncertainty caused by the Covid-19 pandemic, the group is paying an initial consideration of £6m to acquire Businesswise on a debt free cash free basis, to be satisfied in cash at completion.
In order to incentivise the vendors, further contingent consideration of up to £23.5m may become payable in cash, subject to the achievement of challenging EBITDA and order book growth targets for the years ending December 31, 2021, 2022 and 2023.
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To achieve the earn out in full, Businesswise would be required to generate an EBITDA of £5m for the year ending 31 December 2023 and have a closing order book in excess of £19m.
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GEM provides energy assurance services to corporate customers in a range of industries, with a strong presence in the food manufacturing and distribution sector.
For the financial year ended March 31, 2020, GEM delivered revenues of £500,000 and profit before tax of £250,000.
The group will make an initial cash payment of £1.5m to the shareholders of GEM, with a deferred consideration of £250,000 payable at December 31, 2021, and a potential further contingent cash consideration of up to £250,000 based on achieving a target level of contracted future revenues.
Mark Dickinson, chief executive of Inspired Energy, said: "We are delighted to conclude the acquisition of Businesswise and GEM, which are highly complementary additions to the group.
"Both acquisitions increase our market share for Energy Assurance services, broaden our customer base and significantly increase our units of opportunity.
"We look forward to working closely with the highly experienced and knowledgeable teams of both businesses and welcoming them into the group as we continue to advance our position as a market leader."