Manchester-based corporate rescue firm Begbies Traynor Group plc has announced the acquisition of David Rubin & Partners, a long-established insolvency practice with offices in London and Guernsey, for a maximum consideration of £25 million.
Begbies Traynor said it will pay an initial consideration of £12 million, funded through a placing of shares worth £10 million and the issue of new ordinary shares worth £2 million, and a deferred consideration and earn out payments in cash of up to £13 million.
The deal is the largest acquisition the group has undertaken to date.
Begbies Traynor said it will undertake an equity fundraising that looks to raise £22 million “to satisfy initial cash consideration for the acquisition and to fund pipeline opportunities and for general corporate purposes.”
Canaccord Genuity Limited and Shore Capital Stockbrokers Limited are acting as joint bookrunners in connection with the vendor and cash placings.
The fixed placing price is 105.50p per share.
The share issuance in connection with the acquisition and fundraising is within existing shareholder authorities granted at the 2020 AGM and therefore no shareholder approval is required.
Mark Fry, head of business recovery and advisory of Begbies Traynor Group plc, said: “The acquisition of David Rubin & Partners significantly increases the scale of our business recovery and financial advisory business.
“Combined with our recent acquisition of CVR, we have also materially increased our scale in the key London market.
“We welcome the team into the group and look forward to working with them.”
Begbies Traynor Group executive chairman Ric Traynor said: “This acquisition is our largest to date and is expected to be immediately earnings enhancing.
“It leaves the group well-positioned to increase its market share and continue to grow its business recovery and financial advisory revenues.
“With the benefit of our recent acquisitions and other organic growth initiatives the group is well positioned to deliver material growth in the 2021-22 financial year.“