REG - Water Intelligence - Reacquisition of Fort Worth Franchise

Water IntelligenceAnnouncement

19/01/2022 07:05

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RNS Number : 9302Y  Water Intelligence PLC  19 January 2022

 

 

 

Water Intelligence plc

("Water Intelligence" or "Group")

 

Reacquisition of Fort Worth Franchise

 

Water Intelligence plc (AIM: WATR.L) ("Water Intelligence" or "Group"), a
leading multinational provider of precision, minimally-invasive leak detection
and remediation solutions for both potable and non-potable water is pleased to
commence its 2022 growth plan with the reacquisition of its franchise in Fort
Worth, Texas ("Acquisition") within the Group's American Leak Detection
("ALD") subsidiary.

The Fort Worth reacquisition is a significant transaction in terms of the size
of its current business operations, the territory's future growth trajectory
and ALD's overall corporate strategy of creating regional hubs to enhance
operational scale.  The transaction will be earnings accretive for Water
Intelligence shareholders.

Key terms of the Acquisition

The purchase price of $7.7 million in cash will be paid over three years and
includes all assets required to conduct operations, including trucks and
equipment. The purchase price is based on 2021 pro forma of $3.6 million in
revenue and $1.2 million in profit before tax. The territory had $1.1 million
in gross assets as of 31 December 2021.

Strategic rationale for the Acquisition

The Fort Worth operation is fast-growing and expected to accelerate further by
adding new service locations in north and west Texas during 2022.  Moreover,
today's Acquisition reinforces the Group's strategy of establishing regional
corporate hubs in the US that have scale to fuel growth in nearby corporate
and franchise locations. Operations in the centrally-located Dallas-Fort Worth
metro area can bridge major corporate locations in New Orleans to the
southeast and Phoenix/Tucson to the southwest, as well as franchise locations
in-between.  Due to its location, the plan for the Fort Worth hub is to
establish a training center to add a significant number of trained technicians
for locations throughout the southern part of the United States. As a result
of strong demand for water infrastructure solutions, the Group is experiencing
growth in all ALD locations. As noted in the communication regarding
December's reacquisition of its Southern Oregon franchise, ALD has already
started a new regional training center in Seattle to meet demand for trained
technicians in the northwest part of the United States.

As a result of the transaction, the Group's management team will also be
strengthened with the lead manager of the operation, Leslie Campbell, joining
the Group's management team as Executive Vice President of Operations and
Managing Director of the South Region for American Leak Detection.  Leslie
has already contributed significantly to ALD Operations in helping lead the
Salesforce.com implementation during 2021.

Executive Chairman, Dr. Patrick DeSouza commented: "I am very pleased with
today's reacquisition which launches our 2022 growth plan with confidence.
 We are gaining a skilled and ambitious operating team and deepening our
leadership group.  Given strong market demand for our water and waste water
solutions, irrespective of Covid-19, we will continue to aim high and deliver
results for all stakeholders.  We have a great opportunity ahead of us for
2022 to accelerate our already fast pace of growth and establish our
leadership across our operating geographies - US, UK, Australia and Canada -
with minimally-invasive infrastructure solutions that preserve the world's
most precious resource."

 

The information communicated in this announcement is inside information for
the purposes of Article 7 of Regulation 596/2014

Enquiries:

 Water Intelligence plc
 Patrick DeSouza, Executive Chairman               Tel: +1 203 654 5426
 RBC Capital Markets - Joint Broker                Tel: +44 (0)20 7653 4000

Jill Li

 Elizabeth Evans
 WH Ireland Limited - NOMAD & Joint Broker         Tel: +44 (0)20 7220 1666
 Adrian Hadden
 Ben Good
                                                                   Tel:  +44 (0)20 3903 7715

 Dowgate Capital Ltd - Joint Broker

Stephen Norcross

 

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