Expansys lines up ‘transformational’ £49m deal
ONLINE retailer Expansys, which is controlled by Peter Jones, has agreed to buy two other companies owned by the Dragons’ Den star for £49m.
The acquisition of Buckinghamshire-based Data Select Network Solutions (DSNS) and PJ Media, both based in Buckinghamshire, is subject to a successful £30m share placing at 5.6p a share.
Manchester-based Expansys, which specialises in selling handheld devices like phones and GPS units, said the acquisitions represented the first stage of its strategy to become a global online technology superstore.
It plans to pay £38m in cash and shares for the businesses and cover DSNS debt of £10.8m. Because of the size of DSNS the deal constitutes a reverse takeover and will be subject to shareholder approval on July 23.
Bob Wigley, chairman of Yell Group, has been appointed as chairman and Peter Jones, whose holding will shrink from 75% to 43% following the deal, will join the board as deputy chair. Existing chairman Graham Dawber will stay on as a non-exec.
DSNS is a pre-pay SIM card business which Expansys said will help it build strong relationships with network operators. PJ Media, a website development business, will help the firm develop its website and attract more visitors.
In the year to April DSNS generated a pre-tax profit of £7.3m on turnover of £15.4m. PJ Media reported a pre-tax profit of £700,000 on sales of £2.9m during the same period.
Chief executive Anthony Catterson said: “This is a transformational moment for eXpansys. I am delighted that we have been able to attract such high calibre individuals onto the board, and have also received the support of blue-chip institutions who have joined the share register. This deal opens up a number of significant strategic opportunities for the company that we fully intend to exploit.”
Expansys also announced results for the year to April that showed an 8% increase in turnover to £50.7m. Pre-tax losses before exceptionals reduced to £200,000 from £310,000. The pre-tax loss from continuing operations fell by 30% to £2.7m.
Eversheds advised Expansys with a Manchester-based team led by Daniel Hall, assisted by Daniel Liptrott and Alisdair Outhwaite.
