Costain Group PLC Acquisition (1884W)

TIDMCOST

RNS Number : 1884W

Costain Group PLC

17 August 2015

Costain Group PLC

("Costain" or "the Group")

Acquisition of Rhead Group Holdings Limited ("Rhead Group")

17 August 2015

Costain, the engineering solutions provider, announces that it has completed the acquisition of Rhead Group, a professional services consultancy with a focus on programme and commercial management.

Rhead Group, established in 1985 and operating with over 550 people, provides a range of solutions for the lifecycle of infrastructure, construction and asset management programmes, primarily in the UK, for a number of blue-chip customers including National Grid, Wales & West Utilities and BAE Systems. Rhead Group's senior management team, including Nigel Curry, Rhead Group CEO, will remain with the business.

Costain's strategy is to focus on major customers spending billions of pounds addressing national needs in energy, water and transportation. Those customers are consolidating their supply chains and are seeking an increasingly integrated service offering from their Tier 1 service providers through larger, longer-term collaborative contracts. Rhead Group will further enhance Costain's programme management and advisory capability across all the Group's operations as part of that integrated service offering.

Rhead Group has been acquired for a total cash consideration of GBP36 million on a debt free / cash free and normalised working capital basis and the consideration has been funded from Costain's existing cash and debt facilities.

In the year ended 31 July 2014, Rhead Group generated revenues of GBP63.5 million and EBITDA of GBP5.2 million (before exceptional administrative expenses of GBP0.7 million).

Rhead Group will be fully integrated into Costain in the current financial year and the acquisition is expected to be earnings enhancing from 2016.

Rhead Group will join Costain's Power sector and report into the Natural Resources division.

Separately, Costain is taking this opportunity to combine all of its Nuclear activities across the Group into one unit which will report into the Infrastructure division. This action will enable a more concentrated focus on the opportunities in the Nuclear sector, driven by investment in new energy solutions and the pressing need to deal with the UK's legacy nuclear infrastructure.

Andrew Wyllie CBE, Chief Executive of Costain, commented:

"We are delighted to announce the acquisition of Rhead Group which has a well-established reputation for its collaborative approach, focus on innovation and service delivery excellence.

This transaction accelerates the development of Costain and further broadens our range of capabilities to meet the requirements of major blue chip customers, providing greater ability to deliver integrated solutions across the full lifecycle of a project."

Enquiries:

 
 Costain                                    Tel: 01628 842 444 
 Andrew Wyllie CBE, Chief Executive 
 Tony Bickerstaff, Finance Director 
 Catherine Warbrick, Investor Relations 
  Director 
 Graham Read, Communications Director 
 
   Instinctif                               Tel: 020 7457 2020 
 Mark Garraway 
 Helen Tarbet 
 James Gray

Notes

1. For the year ended 31 July 2014 (the latest set of audited accounts) the Rhead Group reported operating profit (pre exceptional administrative expenses of GBP0.7 million and amortisation of goodwill of GBP2.7 million) of GBP4.6 million and a loss before tax of GBP1.2 million including interest on loan notes under its former capital structure.

2. The Rhead Group has gross assets of GBP40.1 million as at 31 July 2014.

3. GBP26 million of the cash consideration is payable to funds managed by Inflexion Private Equity Partners LLP and GBP10 million to the senior management team, which includes an element of deferred consideration of GBP3 million payable in two equal tranches on 17 August 2016 and 17 August 2017.

4. Costain has acquired the entire issued share capital in Rhead Group Holdings Limited and its subsidiaries.

5. Rhead Group website: www.rheadgroup.com.

This information is provided by RNS

The company news service from the London Stock Exchange

END

ACQGGUAGRUPAUAM

Costain (LSE:COST)
過去株価チャート
から 6 2024 まで 7 2024