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Journeo PLC on Thursday said it has agreed to acquire IGL Ltd for around £8.7 million, funded by a share issue.
The Leicestershire, England-based transport system services provider said it will acquire the entire issued share capital of IGL, with the acquisition expected to be earnings accretive to Journeo.
The company said the acquisition would add about £12 million of sales and £2 million of pretax profit in the first full year after the acquisition.
Journeo said it has raised £7 million to fund the acquisition from a placing and subscription of 6.7 million new shares at 105 pence each, conditional on shareholder approval. The stock was up 12% at 130.50p per share on Thursday morning in London.
The company said part of the proceeds of the placing will be used to repay £550,000 in 10% loan notes. Journeo said all loan note holders intend to use the proceeds of the redemption to subscribe for the new shares.
The company further announced a retail offer to raise up to £350,000 through the issue of 333,333 new shares at the same price as the placing.
Journeo will pay an initial £6.2 million for IGL - which Journeo called the UK’s leading rail passenger information equipment provider, with over 15,000 displays in operation - with £500,000 payable in 476,190 new shares and deferred cash of £2.0 million.
By Harvey Dorset, Alliance News reporter
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