HomeServe strengthens grip on tradespeople sector with £54m acquisition
Home maintenance group HomeServe has increased its presence in the UK tradespeople sector by acquiring the remainder of the Checkatrade online platform in a deal worth £54m.
The Walsall-based group had initially invested £37m earlier this year acquiring a 40% stake in the business alongside the Habitissimo platform in Spain.
In its interims results statement today, HomeServe revealed that it had acquired the remaining 60% of Checkatrade for £54m in cash and shares, taking its total shareholding to 100%.
“There has been substantial progress on defining the business model for an online, on-demand Home Experts platform. Of the total consideration of £54m, £10m is being utilised by Checkatrade’s founder to subscribe for the allotment and issue of 1,193,317 HomeServe shares at a price of £8.38 per share,” it said.
Checkatrade, based in Selsey, provides an online directory of customer-recommended tradespeople with nearly one million unique customer visits to its website every month. This results in approximately 1.3m jobs per annum.
Richard Harpin, founder and Group Chief Executive, HomeServe, said: “I am excited by the potential for HomeServe to become a global online home repairs and improvements platform, delivered via Checkatrade and Habitissimo where we already have a majority holding.
“Today’s announcement that we are buying the remaining 60% of Checkatrade brings the realisation of this vision substantially closer.
“Checkatrade is the market leader in the UK, and delivers a first class customer experience. In our core home assistance business and with an even bigger opportunity in Home Experts, the prospects for growth at HomeServe have never been so strong.”
In a wider context, HomeServe said it had made good progress in the first half and remained on track to deliver further strong growth in 2018.
Customer numbers rose in each established business to total 7.8m. Group policy retention remains high at 82%, reflecting the group’s focus on customer service. Affinity partner households rose to 105m, driven by the addition of 45 new partnerships in North America.
Financially, revenue rose 16% for the six months to September 30, to £366.0m (H1 2016: £314.3m), although statutory pre-tax profit declined 5% to £21.2m (H1 2016: £22.2m) due to an increase in interest and amortisation charges as a result of investments and acquisitions.
Mr Harpin added: “I am delighted with the progress we made across our business in the first six months of this financial year. North America delivered outstanding organic growth, which will be further boosted by the acquisition of our largest ever policy book from Dominion Products and Services.
“The UK made a key strategic acquisition – Help-Link – to give us a stronger foothold in the attractive boiler installations market. France and Spain developed key partner relationships and we continued to explore other partnership-based opportunities for international expansion.”
