Retail systems technology provider Torex Retail plc has announced that it is to acquire non-food retail IT provider KPOS Computer Systems for a total consideration of 8.7 million. This will be satisfied by the payment of 5.0 million in cash and 3.7 million in shares by the issue of 6,839,321 new ordinary shares (Consideration Shares). On completion KPOS had cash balances of 2.1M
The deal represents the first major acquisition by Torex Retail plc since it was listed on Londons Alternative Investment Market earlier this year.
In the financial year ending March 2004, KPOS, which was privately owned prior to the acquisition, achieved revenues of 9.5M and delivered a profit before tax of 800,000. Torex Retail expects the acquisition to be earnings enhancing in the current year. The deal will also strengthen Torex Retails product portfolio and customer base. Torex Retail plans to continue ongoing support and development of the existing KPOS solution set.
The deal will see KPOSs Managing Director and major shareholder Lew Gray join the board of Torex Retails Store Management Solutions business.
KPOS was established in 1976 before undergoing a management buyout in 1988. The company currently employs more than 70 people and has offices in Langley near Slough in the UK as well as in Malaysia. The company is an IBM Premier Business Partner and a Microsoft Certified Solutions Provider.
KPOSs current customer base comprises more than 100 organisations with 3000 installations in 25 countries and the current solution set includes in-store point of sale and back office applications, integrated with sophisticated head office stock control and merchandising systems.
As well as offering a range of EPoS solutions KPOS also provides Retail*Star a proven head office merchandise management solution. The acquisition will enable Torex Retail plc to broaden its product family offering and also provide further opportunity to sell products from the current Torex Retail portfolio.
KPOS has proven solutions to suit many retail sectors including fashion/footwear, furniture/ furnishings, garden centres/ DIY, outdoor/ sports, giftware/stationery, airport duty free and factory outlets. The company specialises in solutions for department store and furniture retailers.
Current users of KPOS supplied solutions include Waterstones, Virgin Megastores, Focus DIY, Millets, Rosebys and Shoefayre.
KPOS has extensive experience in the implementation of large integrated EPOS systems including LAN/WAN POS networks, EFT credit/debit card authorisation, polling and remote systems management.
In addition to standard solutions, KPOS offers a range of communications, business intelligence and data warehousing tools, to provide facilities for customised data analysis and reporting.
According to Torex Retail plc Chief Executive Mark Pearman, We are delighted to welcome KPOS to the Group. This immediately earnings enhancing acquisition expands our growing UK customer base and increases our UK channel to market. KPOS has an outstanding reputation for customer service and this together with their strong product portfolio significantly strengthens our offering in Store Management Solutions.
Lew Gray, Managing Director of KPOS added, This is a very exciting time for KPOS and we are thrilled to be joining Torex Retail at this point in their development. Torex Retail has a blue-chip client base and market leading technology. We look forward to working with the Torex Retail team to firmly establish the company as the leading European retail solutions provider.