£100m reverse takeover for Proactis
Wetherby-based Proactis, a spend management solution provider, has made the major, £102.4m acquisition of Perfect Commerce.
The deal, which constitutes a reverse takeover under the AIM rules and is subject to shareholder approval), will accelerate Proactis’ growth strategy and its geographic footprint.
Hampton Wall Jr, currently president and chief executive officer of Perfect Commerce, has been hired as chief executive officer of Proactis. Wall will replace Rod Jones as chief executive officer, who retired from the board yesterday with immediate effect.
Tim Sykes, the current chief executive officer designate and CFO will then resume his role as chief financial officer.
Perfect Commerce develops cloud-based, technology-led, spend management solutions for the public and private sector markets, with global operations in the US, UK and Europe.
In a busy morning for the group, it also announced plans to raise £70m via a share placing, and new debt facilities from HSBC of £45m.
Proactis, which has a market cap of around £87m, reported revenue of £19.4m for the year to July 2016, up from £17.2m in 2015, while adjusted EBITDA increased by 10% to £5.3m.
Tim Sykes, chief financial officer of PROACTIS, commented: “This is a highly complementary and transformational acquisition which we expect to be earnings enhancing in the financial year ending 31 July 2018.
“The acquisition will accelerate PROACTIS’ growth and bring substantial global scale to the Group, positioning us to exploit the high growth areas of the spend management market and enabling us to provide our customers with an even broader product offering.
“In addition, it will build our scale in the US, UK and mainland Europe, with the Enlarged Group having a uniquely balanced and scaled commercial and operational capability across all of those territories. The combined solution set will enable us to target both larger and more complex customer contract opportunities, wherever that customer might be located.”
Hamp Wall, president and chief executive officer of Perfect Commerce, commented: “We are excited to be joining PROACTIS at a time of such rapid innovation in the industry. We have a highly complementary product set, customer base and geographic reach and we look forward to offering our customers an enhanced product offering.
“I was extremely encouraged by the appetite of investors and HSBC for this transaction and I look forward to delivering value for them in return.”
Walker Morris is leading the deal across 11 jurisdictions. Richard Naish, who led the Walker Morris team, commented: “Being a full service, independent law firm allows us not only to provide a complete service in the UK but also to adopt a ‘best of breed’ approach to select high quality law firms in other jurisdictions and coordinate their advice for the client. It’s an approach that is increasingly finding favour with our clients and has allowed us to increase our revenues from international clients significantly over recent years.
“This latest acquisition is a significant milestone in PROACTIS’ development and we are delighted to be advising on the deal, building on our long history with the business.”
The Walker Morris team comprises Richard Naish, Jo Stephenson, Christopher Blair, Laura Poole, Richie Lamb and James Farrell (Corporate), Michael Taylor, James Crellin and Antonia Hull (Finance) and Lorna Hopps (Employment) and Nicola Parkinson (Tax and Incentives).
Walker Morris has previously advised Proactis on a number of fundraisings and acquisitions including that of Millstream Associates in November 2016 and Due North in February 2016.
KPMG Deal Advisory also worked on the deal and Chris Stott, KPMG partner, commented:”This transaction continues the strong trend of consolidation in the tech sector and in particular financial support services.”
