Broker acquired by AIM-listed firm in £2m deal
SPECIALIST broker Intelligent Financing has been acquired by Aim-listed provider of finance facilities to SMEs, 1pm plc, in a £2m deal.
The Cardiff-based firm, which trades as Intelligent Loans, is owned by directors Alun Winter and Robert Coles, who founded the business in 2010.
They were advised on the deal by Cardiff-based corporate advisory firm Lexington.
The FCA regulated brokerage firm is a specialist lending packager focussed on mortgages, secured loans, bridging finance and commercial lending.
It earns commission income from a wide panel of lenders and has a growing network of 1,200 introducers from whom a significant level of repeat business is generated.
The business is growing and profitable and for the financial year to 31 January 2017, it completed more than 250 commission-earning transactions. This generated £1.5m of commission income and an EBITDA of £400,000.
1pm plc have agreed to acquire Intelligent Financing for up to a maximum of £2m. With the deal now finalised, this has seen £1m paid in cash and £200,000 in 1pm shares.
A further cash payment of up to £800,000 could be made if the business hits performance targets.
Both Mr Winter and Mr Coles have agreed to continue to run the business.
Bath-based 1pm plc has a stock market valuation of around £31m and a track record of strong organic growth.
The sale of Intelligent Financing marks the first transaction in the Lexington pipeline to complete in 2017 and the first to conclude since its management buyout last month.
In 2016, Lexington advised on more than £25m of transactions. Greenaway Scott of Cardiff acted as legal advisor to Intelligent Financing for the sale.
The joint directors of Intelligent Financing said: “As part of the enlarged group we will be able to accelerate our growth, not only through cross-selling opportunities, but by benefitting from the elevated profile and the added security and transparency that comes from being part of a listed company.”
Gary Partridge, managing director of Lexington, said: “We are delighted to have supported Alun and Rob through the process of selling their business to 1pm plc.
This marks a culmination of their hard work building the business over the last seven years and as part of the enlarged business, their Intelligent Loans business will continue to grow and offer 1pm plc the opportunity to fund selective loans to growing businesses on its own balance sheet.
“Lexington are supporting a number of businesses to help them realise value and move to the next stage of their development and we hope to be able to announce further deals shortly.”