Water Intelligence PLC Reacquisition of San Jose, California Franchise (6041O)
02 Junio 2020 - 1:00AM
UK Regulatory
TIDMWATR
RNS Number : 6041O
Water Intelligence PLC
02 June 2020
Water Intelligence plc
Reacquisition of San Jose, California Franchise
Water Intelligence plc (AIM: WATR.L) ("Water Intelligence" or
"Group"), a leading multinational provider of precision,
minimally-invasive leak detection and remediation solutions for
both potable and non-potable water is pleased to announce the
reacquisition of its San Jose, California franchise ("San Jose")
within the Group's American Leak Detection subsidiary ("ALD").
San Jose is the second significant reacquisition that the Group
has executed during the second quarter while navigating the
Covid-19 crisis. The first one - Minneapolis - provides a regional
corporate base in the Upper Midwest, where the Group has been
successful in also cross-selling municipal leak detection solutions
from its UK-based Water Intelligence International operations. The
reacquisition of San Jose, meanwhile, is exceptionally strategic in
that it enables the Group to have a regional corporate base in
Silicon Valley.
As discussed below, the acquisition is accretive to shareholder
value and builds on a long-term growth strategy that over the last
five years has delivered compounded annual growth of 35% in terms
of revenue and 33% in terms of profit before taxes. ALD operates in
46 states of the United States and generates over $125 million in
sales to third parties. Its solutions are delivered by franchise
locations and corporate locations operating under the same brand.
As part of its long-run growth strategy, the Group seeks to
reinforce ALD's brand leadership across the United States through
reacquisitions of select franchises and the establishment of
regional corporate operations that reinforce and fuel growth in the
franchise System.
A corporate presence in Silicon Valley will enable the Group to
advance its innovation roadmap and to build on strong R&D
relationships that the Group has at Stanford University. Corporate
operations will also reinforce the growth of two already
successful, multi-million dollar franchises in the San Francisco
and Berkeley geographies of the Bay Area.
Financially, for full-year 2019, San Jose franchise operations
generated approximately $0.7 million of sales and $0.2 million of
pre-tax profits. The purchase price for the reacquisition which
includes all assets to conduct operations (trucks, equipment etc.)
is approximately $1.05 million to be paid over three years.
Commenting on the Group's performance, Executive Chairman, Dr.
Patrick DeSouza remarked: "We continue to distinguish ourselves
among companies operating in the Covid-19 marketplace. We are
accelerating our growth plans during Q2 given our success in
navigating the crisis during Q1. Water and wastewater solutions are
"essential services" and we continue to operate in line with
shelter-in-place policies. Global market demand for solutions to
water loss from leakage and to health issues from failing
wastewater infrastructure is strong and continues to grow.
The reacquisition of San Jose is very strategic. The Group's
solutions are driven by cutting-edge technologies. With a corporate
presence in Silicon Valley, we plan to extend our leadership in
bringing further innovation to solve the world's water and
wastewater problems."
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014
Enquiries :
Water Intelligence plc
Patrick DeSouza, Executive Chairman Tel: +1 203 654 5426
Adrian Hargrave, VP Corporate Development + 44 (0)7775 701 838
WH Ireland Limited - NOMAD & Broker Tel: +44 (0)207 220 1666
Adrian Hadden
James Sinclair-Ford
Matthew Chan Tel: +44 (0)203 903 7721
Dowgate Capital Ltd - Broker &
Advisor
Stephen Norcross
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END
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