Acquisition of R.W.Gregory
13 March 2008
RPS announces the acquisition of RWG, a UK based consultancy providing specialist engineering advice to blue chip clients in the public and private sectors.
RWG was established in 1934 and became a limited liability partnership in 2002. It provides specialist engineering consultancy services which enable a wide range of government agencies and private companies plan and design large complex buildings cost effectively. An expanding part of RWG's role in projects is to advise upon reducing energy use in buildings, with the consequence of lessening their carbon footprint. RWG currently employs 130 full time staff in offices in Newcastle, Leeds, Birmingham, Manchester and Cardiff. It specialises in providing advice to the health, education and retail sectors and is also active in a number of other sectors, including aviation. It has buoyant order books.
RWG will be integrated with RPS's Planning and Development business in the UK. It is envisaged that our existing businesses in the UK and Ireland will benefit from the involvement of RWG in future projects and that with RWG's skills we will be able to accelerate the development of our energy efficiency consultancy activities. All RWG staff have joined RPS and will be engaged in the combined business going forward. Nine of the 11 partners who are the vendors of the business, have signed service agreements committing them to RPS for at least three years; the other two partners retired at completion.
In the year ended 30 April 2007, RWG had revenues of £12.1 million and adjusted profit before tax of £1.48 million (having normalised partner remuneration costs). Net assets at 30 April 2007 were £2.75 million.
RPS is acquiring the goodwill, trading name and the key assets and liabilities of RWG, for a maximum total consideration of £10.1 million, of which £8.4 million will be paid in cash and £1.7 million in new RPS shares. At completion£5.2 million was paid in cash and 572,969 shares to the value of £1.7 million were issued to the vendors. Subject to certain operational conditions being met, the balance of the consideration (£3.2 million) will be paid in cash, in approximately three equal parts, on 12 March in 2009, 2010 and 2011.
Application will be made to the UK Listing Authority and to the London Stock Exchange for listing of the new RPS shares to be issued as part of the consideration. These new shares will rank equally with the existing ordinary shares
Brook Land, Chairman of RPS commented:
"Our Planning and Development business has been the bedrock of RPS's development over the last three decades. It is recognised as market leading in the UK and Ireland and is growing quickly in Australia. From time to time we extend its range of skills into new and important areas. The acquisition of RWG will position us strategically in providing advice to our clients on achieving energy efficiency at all stages in the planning and development of new buildings.
"Our acquisition pipeline remains strong and the RPS board anticipates that more acquisitions will be completed shortly, further underpinning the Group's growth."
13 March 2008
RPS is an international consultancy providing advice upon the development of natural resources, land and property, the management of the natural and built environments and the health and safety of people. We trade in the UK, Ireland, the Netherlands, Poland, North America, South East Asia and Australia and undertake projects in many other parts of the world.
|RPS Group plc|
|Dr Alan Hearne, Chief Executive||Tel: 01235 863 206|
|Gary Young, Group Finance Director|
|Tel: 020 7457 2020|