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Property Franchise Group (TPFG) has announced to the stock exchange that it has agreed an agreement to acquire Fine and Country and Guild of Property Property Professionals from Nurtur, a technology and communications provider to the residential real estate industry.
The deal will create a network of around 1,800 letting agents and estate agents across the UK and overseas.
TPFG is said to be paying £20 million for the two assets. £15 million will be paid in cash on completion and £5 million in the first year after completion.
highlight:
· Together, Guild and Fine & Country serve 1,036 stores, 65 of which are international.
· For the financial year ending 31 December 2023, the acquisition will generate audited revenue of £13.2 million, audited EBITDA of £3.5 million and PBT of £3.3 million.
o 73% of fiscal 2023 revenue was expected to come from continuing memberships and licenses.
· The total consideration represents approximately 5.7x 2023 audited EBITDA.
· The initial consideration of approximately £15 million to be paid in cash has been funded through a new credit facility with Barclays Bank.
· Post-acquisition Group leverage expected to be below 1x adjusted EBITDA in 2023
· The acquisition is consistent with the Group’s strategy of acquiring profitable businesses with complementary and recurring revenue streams that provide network expansion and geographic growth.
· The highly respected and experienced management team, including Ian MacKenzie, will continue with the business.
· Expect an immediate increase in revenue
Gareth Samples, CEO of TPFG, commented: “This acquisition continues the delivery of our wider strategy to add breadth and depth to our network. It further strengthens TPFG’s recurring revenue streams and adds a new dimension of licensing to its platform, as well as the important complementary service of printed marketing materials. I am excited to be working alongside Ian MacKenzie and the team to continue growing the group overall and deliver further benefits to our network.”
Ian Mackenzie, CEO of the Guild and Fine & Country, added: “I am truly pleased and excited about the opportunity this combination creates to bring The Guild and Fine & Country under one established and growing organization and expand TPFG’s geographic reach.”
“We have a proven track record of delivering innovation and marketing services across our network and now being part of a larger group will enable our customers to benefit from partnerships with their existing suppliers and for us to introduce significant additional benefits.”
TPFG says it successfully completed its transformational merger with Belvoir in March 2024 and continues to deliver on the results of its acquisition strategy.
The acquisition of The Guild and Fine & Country from Nurtur.Group Limited is an opportunity to further accelerate growth through additional recurring network revenue. With initial consideration of £15 million paid in cash funded from the Group’s debt facilities, the acquisition is immediately accretive to earnings. The balance sheet will remain strong following completion of the acquisition, with overall leverage post-completion being below 1x adjusted pro forma EBITDA for 2023*.
*Adjusted EBITDA for 2023 is £23.2 million (including Belvoir, acquired in March 2024).
Group Pro Forma Income Statement Highlights
Audited (£ million) |
TPFG* |
Acquisition |
combination |
|||
|
2022 |
2023 |
2022 |
2023 |
2022 |
2023 |
Revenue |
60.9 |
61.5 |
13.5 |
13.2 |
74.4 |
74.7 |
gross profit |
41.9 |
42.4 |
9.5 |
8.9 |
51.4 |
51.3 |
Adjusted EBITDA |
22.4 |
23.2 |
3.5 |
3.7 |
25.9 |
26.9 |
PBT |
18.0 |
18.1 |
3.2 |
3.3 |
21.2 |
21.4 |
*Includes Belvoir financial information for 2022 and 2023
The acquisition will expand TPFG’s existing network of 910 stores, increasing the total network to over 1,946 stores and bringing highly complementary expertise to the Group. The acquisition will immediately strengthen TPFG’s reach and marketing, giving it an international footprint for the first time.
Guild is a well-known and long-standing brand founded almost 30 years ago, supporting its network of 778 stores with a range of services and benefits, including marketing, compliance and training.
Fine & Country supports its licensees with the technology, market insight and marketing capabilities of its global brands and operates from 193 locations across the UK, plus 65 locations in Europe, Africa, Asia and Australia.
TPFG’s platform will give its newest partners access to additional benefits and services through its brand and complementary network divisions, and TPFG will gain access to a 20-strong team of marketing professionals who have led the successful growth of The Guild and Fine & Country.
Both companies will continue to operate under their existing brands, and the experienced management teams from The Guild and Fine & Country will remain in their current roles to continue to support the network divisions.
Following the completion of the acquisition, there will be no changes to TPFG’s Board of Directors.
TPFG will pay an initial consideration of £15 million, payable in cash on completion, funded by drawdowns on TPFG’s new debt facility with Barclays Bank, subject to customary adjustments.
To fund the acquisition and support its future growth, TPFG has entered into a new debt agreement with Barclays for up to £27 million, of which £15 million will be used to cover initial costs.