Beeks snaps up data analytics firm Velocimetrics for up to £4.55m
(AIM:BKS ) has snapped up data analytics firm Velocimetrics for up to £4.55m in a deal worth an initial £1.3m in cash and equity, plus a contingent earn-out.
The Glasgow-based group said the acquisition would expand its product offering with new services to its clients to differentiate it from cloud storage and infrastructure competitors.
Founded in 2009, London-based Velocimetrics provides real time network monitoring and trade analytics software to clients worldwide including the Australian Securities Exchange, trading platforms City Index and X2M as well as banks and hedge funds.
It operates with a mix of licence and recurring revenue through subscription and maintenance, reporting £1.16m of revenue, loss before tax of £0.47m and EBITDA loss of £0.18m for the year ended 30 June 2019.
Shares in Beeks Financial Cloud Group were trading 5.52% higher at 95.5p this morning.
Beek’s Chief Executive, Gordon McArthur, said, "While the Group is focused on organic growth, we continue to assess strategic acquisitions that will complement our business model and expand our offering.”
The acquisition will be funded by a £1.5m debt facility from RBS which will also add growth capital for the enlarged group.
The maximum aggregate consideration payable - including the base consideration - is £4.55 million, capped at 2x the revenue earned by Velocimetrics during the financial year ending 30 June 2021.
Meanwhile, Beeks said it had seen minimal impact on current trading from measures implemented due to Covid-19, with continued operational cash generation, increased annualised contracted monthly recurring revenue and recurring revenues of about 95%.
“While we are unlikely to be entirely unimpacted, we believe we are in a strong position to withstand the current challenges,” added McArthur.
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