Acquisition
29/04/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220429:nRSc7635Ja&default-theme=true
RNS Number : 7635J Rotala PLC 29 April 2022
RNS Reach
29 April 2022
Rotala Plc
("Rotala" or the "Company" or the "Group")
Acquisition of established bus operator in Warwickshire and the West Midlands
Rotala plc (AIM:ROL) is pleased to announce the acquisition from Johnsons
(Henley) Limited of its entire bus business and 20-strong fleet, for a cash
consideration of £936,000 payable on completion (the "Acquisition"). The
business being acquired is a well-established operator of commercial and
contracted bus services in Warwickshire and the southern West Midlands. The
Acquisition is expected to be earnings enhancing from completion.
Rotala estimates that the assets being acquired have annual revenues of
approximately £3.5 million and that the vehicle fleet has a fair value which
approximates to the cash consideration being paid. Rotala will not assume any
other assets or liabilities of any materiality on acquisition. On this basis,
the Acquisition is not expected to generate any goodwill.
The Directors believe that, following completion, the Acquisition will
generate EBITDA of approximately £200,000 per annum for the Group. No
additional overheads are expected to be required as a result of the
Acquisition.
Following completion, the business, trading at present under the "Excelbus"
brand, will be subsumed into the Company's Diamond Bus business operating out
of its existing Redditch depot and the buses will be rebranded into Diamond
Bus livery. Approximately 60 employees are expected to transfer to Diamond Bus
with the business. The Acquisition will extend the Group's network of bus
services in Warwickshire and the West Midlands and make more efficient use of
the capacity of the Company's Redditch depot.
Completion of the Acquisition is expected to occur on 29 May 2022, after
giving due time for the necessary consultation with the transferring employees
under the Transfer of Undertakings (Protection of Employment) Regulations
2006.
Simon Dunn, Chief Executive of Rotala, said: "In our recently published Annual
Report, we highlighted our belief that the Group was very well placed to take
advantage of the acquisition opportunities that were likely to arise as
commercial reality returned to the bus industry after COVID 19. The
Acquisition is an example of such a transaction and we continue to look for
others.
The Acquisition also fits in with a key part of the Group's strategy in
seeking to consolidate smaller businesses in our existing areas of operation
so that we make better use of our current depot capacity and so spread
overheads over a larger business, with a corresponding increase in business
efficiency."
For further information please contact:
Rotala Plc 0121 322 2222
John Gunn, Chairman
Simon Dunn, Chief Executive
Kim Taylor, Group Finance Director
Shore Capital 020 7408 4090
Tom Griffiths / James Thomas / Michael McGloin (Corporate Advisory)
Henry Willcocks (Corporate Broking)
About the business
Rotala provides a range of transport solutions, ranging from local bus
services under contract to local authorities, through to commercial bus
routes. Rotala has operations at Heathrow Airport, in the West Midlands and in
the North West. Operating companies are Diamond Bus Ltd, Diamond Bus
(North West) Ltd, Hallmark Connections Ltd and Preston Bus Ltd.
This information is provided by Reach, the non-regulatory press release distribution service of RNS, part of the London Stock Exchange. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
Reach is a non-regulatory news service. By using this service an issuer is confirming that the information contained within this announcement is of a non-regulatory nature. Reach announcements are identified with an orange label and the word “Reach” in the source column of the News Explorer pages of London Stock Exchange’s website so that they are distinguished from the RNS UK regulatory service. Other vendors subscribing for Reach press releases may use a different method to distinguish Reach announcements from UK regulatory news.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END NRAUWOVRUAUSUAR