Spiritel plc, the business communications service provider, has acquired WN1 Ltd. (WN1), for a total consideration of up to 2.02 million.
Under the terms of the acquisition, Spiritel has agreed to pay a total consideration of 2.02 million comprising 1.47 million in cash and performance-related earn-out payments of up to 0.55 million payable by 31 May 2009. The initial cash payment is financed by an increase to Spiritels senior debt facility with Clydesdale Bank plc and the subscription by the vendors for 0.3 million of unsecured zero coupon loan notes redeemable on 1 May 2009. The vendors of WN1 will also receive a payment, equal to WN1s net cash balance on completion of 1.09 million. As at 28 February 2008, WN1 had net assets of approximately 1 million, including a net cash balance of 1.1 million.
WN1 is a leading accredited reseller of mobile voice, data and Blackberry services, and holds key industry contracts as an O2 Advance Partner, T-Mobile Business Partner and a Blackberry Alliance Member. WN1 targets its operations exclusively towards business clients, which include a number of blue chip companies such as Lufthansa, Servisair and Topps Tiles.
The purchase of WN1 is Spiritel's fifth acquisition in 18 months and adds mobile services to the Companys product set, completing Spiritels fully integrated voice and data offering which includes VoIP, data networking, telephone systems and ISP services. It is anticipated that the acquisition will be earnings enhancing immediately upon completion. WN1, to be rebranded as Spiritel Mobile, will be relocated to Spiritels Wigan office in order to deliver operational synergies and cost savings.
Commenting on the acquisition, Alastair Mills, Chief Executive of Spiritel said: "WN1 is a strategic and highly profitable acquisition that allows us to complete our business communications offering by adding mobile voice and data services. WN1 has an impressive track record of revenue and profit growth and the incremental earnings will further enhance our recently reported turnaround in financial performance."