Clipper Logistics hads announced the acquisition of the entire issued share capital of RepairTech Limited ("RepairTech").
RepairTech is a specialist provider of consumer electronic repair services based in Southam, Warwickshire.
The effective handling of returned products is important to retailers and manufacturers to both protect margins and minimise working capital. Clipper's market-leading "Boomerang" service is designed to rapidly recover and return to saleable stock products returned by consumers.
The Boomerang service suite was extended by the acquisition of Servicecare Support Services Ltd in December 2014, and the acquisition of RepairTech enables the Group to provide a comprehensive range of returns management services across the whole spectrum of apparel, general merchandise and electronic and electrical equipment.
The Group anticipates that the activities undertaken by RepairTech will enhance the range of services provided to existing Clipper customers, as well as attracting new clients to the Group.
RepairTech was established in 1999 by the current Managing Director, Richard Costello. It is consistently profitable, and reported underlying earnings before interest and tax of £644k on revenues of £3.2m in its unaudited financial statements to March 2017. The acquisition will be immediately earnings-enhancing to Clipper.
Consideration is £2.5m in cash, with a further £0.5m deferred for 12 months. Assets acquired with the business include net cash balances of approximately £0.3m. The consideration is being funded from Clipper's existing cash and bank facilities.
All members of the senior management team of RepairTech, including Managing Director Richard Costello, will remain with the business to continue to deliver significant organic growth both in its own right, and across the wider Clipper customer base.
Steve Parkin, Executive Chairman of Clipper, commented:
"RepairTech is a robustly profitable and cash generative business. The acquisition will enable us to offer existing and prospective customers of both RepairTech and the Group a truly comprehensive range of returns management services. We welcome the employees and management team of RepairTech to the Clipper group, and look forward to continuing to build the breadth and depth of our services and customer base".