BidEnergy acquires Optima Energy Systems

BidEnergy, an Australian company which provides Utility Bid Expense Management Solutions in Australia, the UK and the USA, has acquired energy management software business Optima Energy Systems, a Skipton, UK-based energy management software business providing: bill validation, budgets and accruals, and tenant and self-billing.

Terms of the transaction

Bid is paying £5.4 million for Optima, plus a conditional Deferred Payment as follows:

  • £3.2 million, payable in cash upfront
  • 3.384 million Bid shares are to be issued to Optima vendors at an issue price of A$1.16 per share (~A$3.9m)
  • Shares will be subject to escrow as follows
    • 25% – 9 months from completion
    • 50% – 12 months from completion
    • 25% – 15 months from completion
  • A Deferred Payment, payable in cash, subject to Optima achieving certain performance milestones regarding revenue and costs within the year following the Completion Date
  • The “Deferred Payment” has two components:
    • A £250,000 payment on achievement of certain recurring cost reductions prior to 31 March 2021; and
    • A payment based on recurring run rate revenues achieved in the Optima business in the 12 months following completion (Bid has provisioned for a payment of F750,000, but the payment could be higher or lower).
  • Steve Wright, Optima’s Managing Director will remain engaged by Optima for at least 12 months, with the potential for a consultancy arrangement thereafter.

The transaction terms value Optima at a multiple of 2.9 times FY20 revenue.

The Optima acquisition adds a further A$3.4m1 to Bid’s annualised subscription revenue, taking overall expected group earnings to A$17.9m as at Nov. 2020

Optima was established in 1998 and has 127 full time employees. In the year to 31 March 2020 Optima had unaudited revenue of £2.18 million and was EBITDA positive (figure not disclosed). The company directly manages energy data for 51 clients, who in turn are responsible for 196,400+ meters under management across the UK. Clients are multi-site MNCs, TPI/Brokers, property management agents, etc

Bid already had a long term relationship with Optima, having provided data collection services to support a limited part of their core business.

Full transaction details here

Australia, Melbourne and UK, Yorkshire

eEnergy Group plc to acquire Beond Group

eEnergy Group plc is to acquire Beond Group Limited, a UK renewable energy consulting and procurement business.

Beond, based in West London, helps its clients to transition to the lowest cost zero carbon energy available in the market. Working with small businesses to large corporates and public sector organisations it runs competitive reverse auctions through its proprietary technology. This ensures that its clients have access to the lowest prices across the market while achieving their net zero energy ambitions. It offers a Risk Managed service for clients that wish to have access to the energy wholesale markets and implements hedging strategies to help protect against rising market prices.

The total consideration for the Acquisition (which includes £0.7 million of surplus cash in the business) comprises approximately £2.4 million in cash and the issue of 64,948,456 consideration shares.

For the year to 31 December 2019, Beond’s revenue grew 10.5% to £3.3 million, with EBITDA of approximately £0.5 million at a margin of 14.1%;

eEnergy Group expects Beond to generate:

  • revenue growth at an annual average rate of 22% from the year to 31 December 2020 to 31 December 2022
  • base case EBITDA for the year to 31 December 2021 of approximately £0.8 million;
  • EBITDA margin improvement from 14% for the year to 31 December 2019 to 28% for the year to 31 December 2022;

The cash component will be funded through a placing of a minimum of £3.0 million to new and existing institutional and other investors, at a Placing Price of 10.0 pence per placing share.

CEO of Beond, Derek Myers, is expected to join the Board of eEnergy on completion of the acquisition.

An integration team, led by new (non-Board) Chief Operating Officer, Robert Van Leeuwen, is expected to work closely with the Beond management team and oversee initiatives to accelerate growth.

Harvey Sinclair, CEO of eEnergy, commented: 

“The acquisition of Beond is the next step in our journey to delivering a sustainable future for our clients. Beond’s, a climate action business, leverages award-winning technology to secure the best zero carbon energy supply for their customers. With a focus on energy management, their technology will add significant value to eEnergy’s existing client base by helping to make ‘Net Zero’ a reality. Beond’s platform is one of a very small number of specialised reverse auction technologies available to customers, securing the best priced zero carbon energy through a highly competitive auction process. 

eEnergy, listed on AIM, is the parent company of eLight and RSL, which help businesses and schools switch to energy-efficient LED.

UK, London

424 Capital invests in Hospital Energy


Boston based investment firm 424 Capital has launched its first new fund in the 424 series, 424 Capital Fund I, which simultaneously completed the acquisition of Hospital Energy, anenergy management firm which develops and manages energy procurement strategies for US hospital systems.

Together with Eagle Private Capital, 424 Capital purchased a majority share from Founder and CEO Mark Mininberg, who will remain CEO of Hospital Energy. 

Founded in 1995, Hospital Energy’s energy procurement programs serve to lower a hospital’s spend on gas and electricity while reducing energy price volatility. Managing energy use and spend at over 200 hospitals, the Company focuses on all matters related to energy efficiency, resiliency, and sustainability and is the only energy procurement organization focused exclusively on the hospital market in all deregulated US markets. Hospital Energy also organizes and manages onsite renewable power generation which serve to decrease cost, increase their client’s resilience to power interruptions, and meet reduced carbon footprint standards set by state and local governments.

“I’m very pleased with our investment in Hospital Energy.  The Company’s focus on energy management and sustainability is 100% aligned with our core values and investment goals” said Walter Beinecke, Partner at 424 Capital, who will serve as Chairman of the Company.  “Mark Mininberg has built a very solid business with the best possible reputation, which will serve as a terrific platform as we seek to build leadership in the US energy management sector.”

“424 Capital has built strong industry knowledge in energy management and has a long history investing in the healthcare sector”, said CEO Mark Mininberg. “We are excited to partner with 424 Capital while continuing to provide the highest level of service to our client base.”

USA, Wakefield, MA & Elmhurst, IL

Inspired Energy acquires an initial 40 per cent of Ignite Energy

inspired-logo4Inspired Energy plc has acquired an initial 40 per cent share of Ignite Energy Limited

Inspired are paying an initial £5.0 million to acquire the 40 per cent on a debt free, cash free, normalised working capital basis. A further consideration of up to £3.0 million may become payable in cash, subject to the achievement of financial performance targets for the year ending 31 December 2019. The Initial Consideration has been financed from the Inspired’d existing resources, with funding provided by a drawdown of the Group’s £12.5 million acquisition facility with Santander.

Inspired has an option, until 31 July 2021, to acquire the remaining 60 per cent off Ignite Energy. Details of the option agreement are below. Inspired’s Mark Dickinson (CEO) and Paul Connor (FD) will join the board of Ignite, which will consist of five people.

Ignite provides energy management solutions to large multi-site commercial energy users. Services include energy procurement, energy efficiency and optimisation services The business began trading in 2009 and is led by David and Ben Higgins. Headquarted in Wantage, Oxfordshire, Ignite employs 51 people based across 3 locations in the UK.

For the financial year ended 31 December 2018, Ignite had revenues of £12.41 million, profit before tax of £3.08 million and generated operating cash of £1.50 million. Net assets as at 31 December 2018 stood at £4.08 million.

Mark Dickinson, CEO of Inspired said: “We are delighted to conclude our strategic investment in Ignite, a business which is highly complementary to Inspired’s core Corporate Division. The Strategic Investment significantly broadens and accelerates our optimisation service offering. Ignite has proven itself, over many years, to be capable of achieving material improvements to the energy efficiency of its clients. Inspired currently has over 500 clients within the estate and energy intensive segments who meet the Ignite customer profile, and could benefit from the services that Ignite provides.”

OPTION AGREEMENT  

·      Under the Option Agreement, from completion until 31 July 2021, Inspired has an exclusive one-way call option to acquire the outstanding balance of 60 per cent of the issued share capital of Ignite (“Remaining Ignite Shares”).

·      Under the terms of the Option Agreement, Inspired will pay consideration for the Remaining Ignite Shares which equates to an enterprise value of 6.0x earnings before interest, tax, depreciation and amortisation (“EBITDA”) (“Option Consideration”). 

·      The Option Consideration shall be based off a minimum EBITDA of £3.0 million, and at the time of exercising the Option Agreement, an amount of £10.8 million will become payable by Inspired.

·      Should the EBITDA be greater than £3.0 million in either of the scenarios shown below, then additional consideration will become payable by Inspired, being the higher of:

–  6.0x Ignite’s EBITDA for the last 12 months ending on the date of the exercise of the option under the Option Agreement, or;

–  6.0x Ignite’s EBITDA for the financial year ending the year in which the option is exercised under the Option Agreement;

–  Less the £10.8 million already paid on exercise of the option, subject to a maximum EBITDA of £7.0 million.

·      Any  additional consideration due will be payable within 90 days following the end of the financial year in which the option agreement is exercised, Ignite’s financial year end is 31 December.

UK, Kirkham, Lancashire & Wantage, Oxfordshire

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The Monarch Partnership acquires EIC and T-Mac Technologies

MonarchUtilities management company The Monarch Partnership has acquired Energy Intelligence Centre (EIC) and T-Mac Technologies. EIC and T-Mac Technologies made up the corporate division of Utilitywise Plc, the energy and utilities brokerage business that went into liquidation in February 2019. The terms of the deal were not disclosed.

Monarch Partnership is a wholly owned subsidiary of Majestic Securities Limited, which also owns ESS Utility Consultants and Smith Bellerby. All 130 staff from EIC and T-Mac Technologies will join The Monarch Partnership. Following the acquisition, the combined group will have 250 employees and combined revenues of £20 million. In the year to March 2018, Monarch Partnership had profits after tax of £2.45 million. The Majestic Securities group had profit after tax of £2.65 million on a turnover of £6.47 million.

Utilitywise acquired EIC from Broadfern Partners in 2013. After the acquisition Utilitywise rebranded the company as Energy Intelligence Centre. It was previously called Energy Information Centre.

Fusion Corporate Partners had sold EIC to Broadfern Partners in September 2007

Acting for Euromoney Institutional Investor, Fusion Corporate Partners sold Energy Information Centre to Broadfern Partners in September 2007 for £4.7 million. EIC had been bought by Euromoney in October 2006 as part of its £22 million acquisition of metal market news service Metal Bulletin.

EIC was founded in 1975 and now supports over 1,000 industrial and commercial businesses and public sector organisations in managing their energy and water requirements. T-Mac Technologies provides energy management and intelligent buildings systems to help clients reduce and monitor their energy consumption. Both businesses will continue to trade under their existing brand identities and operate out of their headquarters in Redditch, supported by offices in Newcastle and Bury St Edmunds.

Peter Dosanjh, Chairman and CEO at The Monarch Partnership, said: “We are building a premier utility consultancy focused on helping our customers to become fully sustainable energy users. Our depth and breadth of expertise is unrivalled, and we are now working with colleagues and clients across the organisation to integrate the businesses and become the UK’s leading intelligent utilities partner. It is great to have Brin (Brin Sheridan, Managing Director of EIC and T-Mac) on board and welcome EIC and T-Mac to the Group.” 

UK, Wallington, Surrey & Redditch, Worcestershire

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Marlowe acquires waste water solutions business Atana for up to £5M

 

Marlowe+PLC+logoMarlowe plc, the support services group, has acquired Atana Limited for up to £5 million.

Founded in 2001, Atana is a provider of wastewater treatment solutions to commercial organisations across the UK. Atana provides recurring services which ensure compliance with wastewater discharge regulations and reduce waste disposal costs. The business is headquartered in Leicestershire and employs around 20 staff.

AtanaFor the year to 31 December 2017, Atana had revenues of £5.1 million, profit before tax of £0.5 million and net assets of £0.4 million. The total enterprise value will comprise an upfront cash consideration of £3 million and a cash earn-out expected to be in the region of £3 million and capped at £5 million for regulatory purposes. The achievement of the £3 million earn-out is dependent upon the business generating EBITDA of £1.4 million in the 12-month period to 31 December 2020.

Alex Dacre, Chief Executive of Marlowe plc, said:

“The acquisition of Atana accelerates Marlowe’s strategy of broadening the capabilities of our Water division across the entire regulated water management cycle. It enables us to provide additional water services to our customers and strengthens our competitive proposition and ability to cross-sell, both within and across our operating divisions.”

UK, London & UK, Coalville, Leicestershire

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Infopro Digital to acquire B2B publisher DOCUgroup

InfoPro DigitalInfopro Digital group is to enter into the acquisition of DOCUgroup, taking a major step in its international expansion. The acquisition will be financed with additional indebtedness, available cash on hand at the group level and an equity contribution from the shareholders of Infopro Digital group. The majority shareholder of Infopro Digital, alongside management of the group, is TowerBrook. The terms of the transaction were not disclosed.

DOCUgroup is a leader in Germany, Austria and Switzerland in business information for the construction, architecture and real estate industries.

DOCUgroup has two main activities: Project Information, whose flagship brand is IBAU, an online subscription platform that references almost 1 million private and public real estate projects; and Product Information, with leading brands such as Heinze and Baunetz, which are digital platforms that enable architects and planners to access databases and detailed information for over 500,000 products. These platforms attract around 15 million online visits each year.

Infopro Digital also offers services to professionals in the building industry in France, Belgium and the Netherlands through Le Moniteur and Vecteur Plus.

Over 500 employees will join the Infopro Digital group, to bring the total to more than 3,200 people worldwide. DOCUgroup generates a turnover of 67 million EUR, which will allow Infopro Digital to reach a turnover of approximately 440 million EUR once the acquisition is completed.

Christophe Czajka, Executive Chairman of Infopro Digital, said,“With the acquisition of DOCUgroup, we become a truly European BtB and Data company. The share of our turnover generated outside of France increased from 14% to 35% in less than a year. Over 1,300 group employees will be based in Germany, the United Kingdom, Switzerland, Belgium, Portugal, Austria, Italy, Spain, the Netherlands, the United States, Hong Kong, and Tunisia.”

Julien Elmaleh, CEO of Infopro Digital, added, “The DOCUgroup DNA fits perfectly with that of Infopro Digital: databases and digital platforms allowing professionals to develop their commercial activity and have detailed and high quality business information. Combined, we will have an unmatched offer for professionals in the building industry”.

France, Ile-de-France & Germany, Munich

Arrow Business Communications acquires European Utility Management

arrow-communicationsArrow Business Communications has acquired European Utility Management Ltd, an Energy broker specialising in Property Development and Management companies. EUM will be integrated into Pulse Business Energy, the energy specialist division of Arrow.

London based EUM was founded by Stephen Perfect in 1998 and has successfully installed electricity and gas connections for temporary builders, landlord and commercial supplies, energy centres and domestic plots. The company also assists clients to minimise costs through bulk purchasing energy and reducing energy consumption.
All EUM employees will join Arrow, including Stephen who will become a member of the Pulse management team and play a key role in customer management.

Chris-Russell-CEO-of-Arrow-e1547117069161Chris Russell, CEO of Arrow commented, “We’re delighted to welcome Stephen and his team on board and equally excited to bring their skill set and market specialism to Pulse. We believe EUM’s customer focus and passion is a great fit for Pulse and look forward to offering those customers access to POD and the highest levels of customer service”.

UK, Newton-le-Willows, Merseyside & London

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Arrow Business Communications acquires Abica and PCR IT

arrow-communicationsArrow Business Communications has acquired Abica Ltd and it’s subsidiary PCR IT Ltd. The terms of the deal were not disclosed.

Abica and PCR are providers of Telecoms and IT services with offices in Glasgow. Arrow have previously made other acquisitions in the Scottish telecoms market, Orca Telecom in 2015 and Siebert Telecom in 2017.

All of the Directors and employees of Abica will be staying on and will work within the Arrow group. David Munro and Gregory Barnett, founders of Abica, will continue to lead a number of key customer relationships and day to day activities. Gregory Barnett comments, “With Arrow’s long history of building successful businesses in the telecommunications sector, we couldn’t be happier about integrating Abica into Arrow. It bodes well for an exciting future over the coming years”.

Abica has around 650 customers and has deployed a range of solutions covering Connectivity, Mobility, IoT, and Unified Communications for both private and public sector organisations. The recent acquisition of PCR IT brought further IT capability into its solution portfolio.

Chris-Russell-CEO-of-Arrow-e1547117069161Commenting on the acquisition, CEO of Arrow, Chris Russell said: “This was our third acquisition in 2018 and becomes our largest one to date. Abica further strengthens our presence in Scotland and combined with our existing business there will create a real Scottish Powerhouse. The Abica and PCR teams have a wealth of experience in delivering solutions to customers whilst maintaining the strong relationships they have built up over the years, which is exactly how we strive to conduct our business in Arrow”.

UK, Newton-le-Willows, Merseyside & Glasgow

Sovereign Capital Partners backs MBO of Utility Bidders

utility bidderPrivate Equity Buy & Build specialist Sovereign Capital Partners has backed the management buy-out of Utility Bidder, an energy broker, offering energy procurement services to UK, SME customers.  The terms of the deal were not disclosed.

Founded in 2009, and headquartered in Corby, Utility Bidder employs around 100 staff and has a sales office in Manchester. The company currently brokers energy and other utilities contracts to over 14,500 SME clients across a number of industry sectors in the UK.

sovereignUtility Bidder has performed strongly growing sales by over 40% in the current year. The team is led by an CEO, Chris Shaw; Sovereign has augmented the management team with the appointment of Mark Wood, formerly CEO of Axa UK, as non-executive Chairman. Founders James Longley and Sally Martin remain with the business, James as Utility Bidder’s MD.

Jeremy Morgan, Partner at Sovereign, said, “We are very pleased to be supporting this business and strong management team in what is a burgeoning market. Utility Bidder has already achieved tremendous success and enjoys established relationships with both its SME customer base and its energy suppliers.  We look forward to working with Chris and the team to help take this top ranked energy broker to the next stage of growth.”

UK, London & Corby, Northamptonshire