REG - Facilities by ADF - Acquisition of Location One Limited

Facilities by ADFAnnouncement

01/12/2022 07:00

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RNS Number : 1713I  Facilities by ADF plc  01 December 2022

1 December 2022

 

Facilities by ADF plc

 

("Facilities by ADF", "ADF", the "Company" or the "Group")

 

Acquisition of Location One Limited

 

Complementary services create an expanded Group offering as investment in the
UK Film and TV industry continues to accelerate

 

Facilities by ADF, the leading provider of premium serviced production
facilities to the UK film and high-end television industry ("HETV"), today
announces the acquisition of Location One Limited ("Location One") ("the
Acquisition"), the UK's largest integrated TV and film location service and
equipment hire company. The Facilities by ADF and Location One businesses are
well known to each other, with a successful history of working together on a
wide variety of productions since Location One's conception.

 

Highlights

 

·    Acquisition of integrated equipment hire company providing
complementary services to that of ADF, having worked together since 2008.

·      Location One customer base includes Amazon Studios, Netflix,
Warner Brothers and the BBC.

·      Moves ADF towards becoming a one-stop-shop to the UK TV and HETV
industry.

·    Initial consideration of £4.43 million paid in cash alongside issue
of 3,407,419 new ADF              ordinary shares, subject to lock-in
agreements.

·     Additional contingent earn out consideration of up to £2.66
million, payable in cash instalments subject to business performance
thresholds over a 36-month period.

·      Acquisition to be immediately earnings accretive.

 

Location One

 

Location One is an integrated TV and film location service and equipment hire
company supporting location and production companies across the UK with its
high-quality equipment and customer service levels. Location One's offering
includes generators, water bowsers, lighting equipment, environmentally
friendly battery-stores/other renewable solutions and other capital light
consumables, all highly complementary additional products to the Group's
existing premium serviced production facility offering.

 

Having embarked on a journey to net-zero (currently carbon-neutral), Location
One leads its market with the ECOPOD recycling solution, waste-water
treatment, battery & hybrid tower- lights and battery-store technology.
Like Facilities by ADF, Location One is an approved albert supplier (as well
as being an Event Partner).

 

Founded in 2008, headquartered in Barking and with locations in London,
Surrey, Bristol, Newport, Manchester and Newcastle, Location One and its team
of 80 employees service a customer base that includes organisations such as
Amazon Studios, Netflix, Warner Brothers and the BBC.

 

Productions that Facilities by ADF and Location One have worked on together
include: The Crown, Top Boy, Lazarus, Becoming Elizabeth, Embankment, My Lady
Jane, and The Gentleman.

 

For the year ended 30 September 2022, Location One generated unaudited
revenues of £9.24 million and an adjusted EBITDA of £2.08 million. The
Acquisition is expected to be immediately earnings accretive.  Location One's
talented executive management, led by founder and MD Crispin Hardy, and other
employees will be joining the Group.

 

Strategic Rationale

 

The Acquisition brings highly complementary services to ADF which will provide
cross selling opportunities to the enlarged Group, as well as delivering
efficiencies through central services. The Board believes that this is a
significant step in becoming the premium one-stop-shop for film and high-end
TV (HETV).

 

Consideration

 

Total consideration for the acquisition is £8.86 million, with 50 per cent.
of the consideration payable in cash on completion, 30 per cent. payable in
cash equally over three years, subject to EBITDA performance conditions, and
20 per cent. payable in ADF ordinary shares and subject to a 12-month lock in.
The cash consideration will be funded from ADF's existing cash resources. The
acquisition is expected to be immediately earnings accretive.

 

Commenting, Marsden Proctor, CEO, said:

 

"Facilities by ADF has worked with and admired Crispin and his team at
Location One for many years as we have a long and excellent track record of
working together on productions across the UK. With both businesses committed
to providing high-quality equipment and customer service levels, along with
having similar cultural values and impressive sustainability credentials, we
are particularly excited by the strategic fit of the two organisations.

 

"This acquisition will enable us to provide the very best services the
industry has to offer under one roof, as the UK continues to experience an
increasing influx of inward investment and production and as we see the demand
for content reaching record levels. It is yet another example of our
commitment to accelerating growth since IPO and a reflection of the hard work
across all teams at ADF. We see great opportunity for this acquisition and
look forward to working with the Location One team to continue to build on
this momentum."

 

Crispin Hardy, founder and CEO of Location One, commented:

 

"By joining forces with Facilities by ADF, we will be capable of bringing a
compelling and expanded offering to the UK film and production industry at a
time when demand for our products is at an all-time high. We are excited to
continue building on our longstanding relationship with Mars and his team and
aligning ourselves with a well-financed company to explore and accelerate
growth opportunities moving forward - particularly in the environmental space
where there is huge opportunity."

 

Admission of Consideration Shares

 

3,407,419 new ordinary shares (the "Consideration Shares") are to be issued as
part of the transaction with application to be made to trading on the AIM
market of the London Stock Exchange ("Admission"). The Consideration Shares
will rank pari passu with the Company's existing ordinary shares. It is
expected that Admission of the Consideration Shares will become effective and
that dealings will commence at 8.00 a.m. on 6 December 2022. Following
Admission, the Company will have 79,407,419 ordinary shares in issue with
each ordinary share carrying the right to one vote.  The above figure may be
used by shareholders in the Company as the denominator for the calculations by
which they will determine if they are required to notify their interest in, or
a change to their interest in, the share capital of the Company under the
Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

 

 

For further enquiries:

 

   Facilities by ADF plc                                          via Alma PR

   Marsden Proctor, Chief Executive Officer

   Neil Evans, Chief Financial Officer

   John Richards, Chairman


   Cenkos (Nominated Adviser and Broker)                          Tel: +44 (0)20 7397 8900

   Ben Jeynes / Max Gould / George Lawson - Corporate Finance

   Alex Pollen - Sales

   Alma PR (Financial PR)                                         Tel: +44 (0)20 3405 0205

   Josh Royston                                                   facilitiesbyadf@almapr.co.uk (mailto:facilitiesbyadf@almapr.co.uk)

   Hannah Campbell

   Stephen Samuel

 

OVERVIEW OF FACILITIES BY ADF

 

ADF's production fleet is made up of premium mobile make-up, costume and
artiste trailers, production offices, mobile bathrooms (known as honey
wagons), diners, school rooms and technical vehicles. The Group provides these
production facilities and additional services after a planning process with
the customer held well in advance of filming. In servicing productions, ADF
staff are available on site and each production is allocated an account
manager who acts as a single lead point of contact during filming.

 

The Group serves customers in an industry that has experienced significant
growth in recent years, with additional demand driven by a material rise in
the consumption of film and HETV content via streaming platforms such as
Netflix, Disney and Amazon Prime. The UK film and TV industry has directly
benefited during this growth due to the quality of its production facilities
and studios, highly skilled domestic workforce, geography, accessibility to
Europe, English language environment and strong governmental support. Major US
streaming companies have now set up permanent bases in the UK, with the UK now
Netflix's third largest operation after the USA and Canada.

 

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