K3 in strategic bolt-on deal
BUSINESS software provider K3 has acquired a small business supplying payment systems to independent retailers for £610,000.
The Salford company, which supplies and supports Microsoft-based enterprise resource planning software, said the swoop for Retail Technology, a Microsoft Dynamics based EPOS would boost earnings and operational capability immediately.
A statement said: “RTL represents an excellent strategic fit with K3’s existing solution for smaller retailers and is expected to be immediately earnings enhancing. The acquisition adds valuable intellectual property, which K3 is already utilising in its offering for the small retail market, as well as critical mass.”
For the year to May 31 2013, Somerset-based RTL generated sales of £800,000 of which a high proportion, approximately 69%, is recurring annual revenue. Pre-tax profit for the period was £140,000 and current trading indicates an operating profit run rate of approximately £0.2m. RTL’s existing customer base numbers some 180 retailers. Net assets at completion are approximately £0.14m.
K3 chief executive David Bolton said: “K3’s focus is on driving organic growth and this acquisition, which will be immediately earnings enhancing, is a strategic infill for us in the smaller systems EPOS market. It will be readily integrated with our existing operations which serve this area of the retail sector.”
