Business
Acquisition of Watermark Technologies Limited
Acquisition of Watermark Technologies Limited.
About this update from Software Circle Plc
[{"type":"text","content":"\n \n \n \n Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the UK Market Abuse Regulation. With the publication of this announcement, this information is now considered to be in the public domain.\n \n \n \n \n \n \n \n \n \n 7 December 2022\n \n \n \n \n Grafenia plc\n \n \n \n \n (\"Grafenia\", the \"Company\" or the \"Group\")\n \n \n \n \n \n \n \n \n \n Acquisition of Watermark Technologies Limited (\"Watermark\")\n \n \n \n \n \n \n Grafenia plc (AIM: GRA) is pleased to announce that it has acquired the entire issued share capital of Watermark Technologies Limited, a provider of\n document management software and systems, based in Shipley, West Yorkshire on a debt free/cash free basis.\n \n \n \n \n \n The total consideration of up to £2.5m will be satisfied in cash.\n The acquisition is expected to be cash flow generative and earnings enhancing in the first year after acquisition.\n \n \n \n \n \n The initial consideration comprises cash of £1.5m to be paid on completion, together with deferred consideration of £1.0m to be paid on the first anniversary of completion.\n \n \n \n \n \n \n About Watermark Technologies Limited\n \n \n \n Watermark's range of\n document management software solutions include 'Papercloud' (a cloud hosted solution), 'Volume' (a client hosted solution) and 'VolumeRemote' (a remotely hosted solution). The products are licensed to hundreds of predominantly SME businesses in the financial, healthcare and insurance sectors. Approximately 90% of Watermark's revenues arise from annual recurring software fees.\n \n \n \n \n \n The business was founded in 2003 by Tim Boggie and Stewart Spink, both of whom will remain\n on a part time consultancy basis for six months. Watermark currently has 11 employees. James Hughes, a Corporate Development Associate within our Software Circle team, has been appointed Managing Director of Watermark.\n \n \n \n \n \n The unaudited financial statements for Watermark for the year ended 31 March 2022 reported revenue of £1.21m, EBIT of £0.44m and closing net assets of £0.46m.\n \n \n \n \n \n \n Acquisition Rationale\n \n \n \n Watermark meets Grafenia's acquisition criteria\n of providing vertical market software with...