Business
Acquisition of Switch Media
Acquisition of Switch Media.
About this update from Iomart Group Plc
[{"type":"text","content":"\n \nRNS Number : 5005F Iomart Group PLC 27 April 2011 \n \n\niomart Group plc\n(\"iomart\" or the \"Group\")\nAcquisition of Switch Media\niomart Group plc (AIM:IOM), the managed hosting and cloud computing services company, is pleased to announce the acquisition of the entire issued share capital of Switch Media Limited (\"Switch Media\") for a total cash consideration of £1.25 million. \n \nBased in Liverpool, Switch Media supplies domain name and shared hosting services to small businesses, operating in a similar market to iomart's Easyspace division. \n \nSwitch Media has over 10,000 customers providing a strong base of additional business from which the Group can expand its small company hosting business.\n \nFor the year to 31 December 2010, Switch Media had EBITDA adjusted for non-recurring items of £79,000 and turnover of £1.3m.\n \niomart believes it can achieve a significant level of cost savings on the integration of Switch Media into the Group through the reduction of overheads. As a result, the acquisition should result in a significant improvement in Switch Media's EBITDA margin and is expected to be immediately earnings enhancing to the Group as a whole.\n \nOf the total consideration of £1.25m, £1.025m has been paid on completion and a further £225k is payable no earlier than October 2011 subject to certain performance criteria being met. In addition, it is expected that Switch Media will have net cash on completion of approximately £100k resulting therefore in an initial net cash outlay of £925,000. \n \nAngus MacSween, CEO of iomart Group plc, stated: \n \n\"The acquisition of Switch Media is a further step in the achievement of iomart's strategy of building a leading hosting company in the UK. Switch Media is an excellent complementary business to Easyspace in the small company segment of the hosting services market and will enhance the growth of iomart through expansion of the Group's customer base and access to new clients.\" \n \n \nFor further information: \n \niomart Group plc ...