REG - Hercules PLC - Acquisition of Advantage NRG Ltd

HerculesAnnouncement

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RNS Number : 6760O  Hercules PLC  27 June 2025

27 June 2025

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 which has been incorporated into UK law by the European
Union (Withdrawal) Act 2018.

 

 

 

Hercules plc

 

("Hercules" or the "Company")

 

Acquisition of Advantage NRG Ltd

 

 

Hercules plc (AIM: HERC), a leading technology-enabled labour supply company
for the UK infrastructure and construction sectors, is pleased to announce the
acquisition of Advantage NRG Ltd ("Advantage NRG").

 

Advantage NRG is a specialist labour supply company providing highly skilled
linesmen for the construction and maintenance of overhead electrical
transmission lines, supporting major utility contractors across the United
Kingdom.

 

Hercules' entry into the power and energy sector positions the Company at the
forefront of the UK's once-in-a-generation transformation of its electricity
networks, driven by soaring demand and the government's commitment to a
net-zero future.

 

Highlights:

 

·    The Company is acquiring 100% of the share capital of Advantage NRG
for an initial cash consideration of £10.2 million, plus a deferred payment
of approximately £1.5m plus a one year earn out, which could result in a
maximum total consideration of £15.7 million. The earn out is based on a
multiple of the average EBITDA for the year ended 28 February 2025 and year
ending 28 February 2026. The acquisition is expected to be margin and earnings
enhancing, and cash generative.

 

·    In the year ended 28 February 2025, Advantage NRG generated £11.1
million in revenue, EBITDA of £1.7m, and a profit before tax of £1.7
million. As of 28 February 2025, Advantage NRG had net assets of £2.5
million.

 

·    The acquisition will mark Hercules' entry into the UK power and
energy sector and is complementary to the labour that Hercules already
supplies to the wider infrastructure industry.

 

·    Established in 2011 and headquartered in Chorley, Lancashire,
Advantage NRG has built a strong reputation in the power and energy sector and
employs approximately 155 skilled operatives.

 

·    Hercules' entry into the UK power and energy sector is in
anticipation of the UK's comprehensive overhaul of its electricity
transmission and distribution networks to meet rising demand and support its
legally binding net-zero targets.

 

·    The initial consideration is being financed through the Company's
existing cash reserves and a new £6.0 million loan being provided by Wasdell
Holdings Limited, a company controlled by Martin Tedham, a non-executive
director and substantial shareholder in Hercules.

 

Strategic Acquisition

 

Hercules' entry into the power and energy sector comes at a pivotal moment.
The UK is embarking on a major upgrade of its electrical infrastructure to
meet rising energy demand, improve energy security, and deliver on its
net-zero targets.

 

National Grid proposals include £58 billion of investment to support a
projected 64% increase in electricity demand by 2035. This includes
constructing a north-south electricity spine, offshore grids, and extensive
reinforcements spanning tens of thousands of kilometres in total.

This investment, supported by the government, is focused on expanding and
modernising the country's transmission and distribution networks to deliver
sustainable and reliable power across the UK.

 

The UK's high-voltage electricity network spans approximately 20,000km,
including 7,200km of overhead lines managed by National Grid in England and
Wales, and 9,300km in Scotland maintained by ScottishPower Energy Networks and
SSEN Transmission.

 

As a result, demand for skilled operatives, particularly overhead linesmen, is
expected to substantially increase. However, there remains a significant
shortage of qualified workers in the UK.

 

The acquisition of Advantage NRG provides Hercules with a highly skilled
workforce and also the training capability and compliance framework to develop
domestic talent and sponsor international operatives, giving Hercules a
significant advantage in this high-growth market.

 

The transaction comes at a strategically important time for the Hercules
Academy, which is benefitting from the recent acquisition of the business and
assets of QTT (Quality Transport Training Ltd). The acquisition of Advantage
NRG will further boost the training capacity at the Academy, whilst opening-up
more cross-selling opportunities across the infrastructure training suite.

 

This is Hercules' third acquisition, following Future Build Recruitment Ltd in
November 2023 and the business and assets of QTT in June 2025. It aligns with
the Company's M&A strategy to scale operations in sectors with long-term,
infrastructure-backed demand.

 

Brusk Korkmaz, Chief Executive Officer of Hercules, commented:

 

"The acquisition of Advantage NRG marks another important milestone in
Hercules' growth journey. As the UK accelerates investment in critical power
and energy infrastructure to ensure energy security, enhance transmission and
distribution networks, and meet its net-zero targets, the demand for highly
skilled labour has never been greater.

 

"Advantage NRG's deep expertise in overhead electrical transmission, and its
ability to source, train and mobilise specialist linesmen, both in the UK and
internationally, perfectly complements our strategy.

 

"We believe this strategic investment will enable Hercules, the Hercules
Academy and Advantage NRG to grow together and play a pivotal role in
supporting the delivery of the UK's essential energy infrastructure."

 

 

Loan and Related Party Transaction

 

The initial consideration is being financed through the Company's existing
cash reserves and a new £6.0 million loan provided by Wasdell Holdings
Limited (the "Loan").

 

Wasdell Holdings Limited is controlled by Martin Tedham, a non-executive
director and substantial shareholder in Hercules. The Loan is interest-only,
repayable in three years, and carries an annual interest rate of 8.0%. Capital
repayments can be made at any time during the term at the Company's
discretion. The Loan is secured by a secondary debenture.

 

The Loan constitutes a related party transaction under Rule 13 of the AIM
Rules for Companies. The directors independent of the Loan (being all
directors except Martin Tedham) consider, having consulted with SP Angel
Corporate Finance LLP, the Company's nominated adviser, that the terms of the
Loan are fair and reasonable in so far as the Company's shareholders are
concerned.

 

 

 

For further information and enquiries, please contact:

 

 Hercules plc                                                       c/o SEC Newgate

 Brusk Korkmaz (CEO)

 Paul Wheatcroft (CFO)

 SP Angel Corporate Finance LLP                                +44 (0) 20 3470 0470

 (Nominated Adviser and Broker)

 Matthew Johnson / Adam Cowl (Corporate Finance)

 Grant Barker / Rob Rees (Sales and Broking)

 Cavendish Capital Markets Limited (Joint Broker)              +44 (0) 20 7397 8900

 Adrian Hadden / Dale Bellis (Sales and Broking)

 SEC Newgate (Financial Communications)                       +44 (0) 20 3757 6882

 Robin Tozer / Ian Silvera / Nina Renata Pop       Hercules@secnewgate.co.uk (mailto:Hercules@secnewgate.co.uk)

 

 

 

 

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