Fri, 30 Apr 2021 | BUSINESS SALE
EDM Group, a Wolverhampton-based digital records firm, has been acquired by Restore for £61 million, more than a 22x multiple of the firm’s most recent post-tax profits of £2.7 million.
EDM is a B2B outsourcing firm, providing information management, digital mailrooms, digital automation and digitisation services to clients from a wide array of sectors including healthcare, automotive, financial and insurance.
Restore describes the acquisition as being strategically important and aligning with its acquisition criteria. The company adds that EDM will be additive to its core records management operations, as well as “transformational” for its digital business.
Restore Chief Executive Charles Bligh said: “I am delighted with the acquisition of the EDM UK business and the value this will create for shareholders. EDM is a business that is well known to us, it is well invested with a loyal customer base and a terrific team of over 430, each of whom we welcome into the Group today.
“Bringing EDM’s scale and capabilities together with ours will deliver even better offerings for customers and build an even stronger UK player in the management of physical and digital data.”
“This acquisition is in line with the growth strategy of the business outlined over the last two years, which is to grow our Record Management business and to enhance the product portfolio and market share in Restore Digital.”
Restore was advised on the acquisition by Fieldfisher, with the advisory team led by Fieldfisher’s Manchester Corporate Partner David Bowcock. Regarding the EDM Group deal and Restore’s wider acquisition strategy, Bowcock commented: "We are pleased to have assisted Restore on yet another significant acquisition as it continues to expand its footprint in record management.”
“The need to convert physical records to digital format remains a business-critical issue in many sectors, even more so since the pandemic, and we continue to support Restore in its strategy to consolidate document management service providers within the digital arm of its business.”
“2021 has so far been extremely busy for M&A and fundraisings by listed clients looking to capitalise on the COVID-19 economic recovery.”
In its most recent accounts, for the year ending March 31 2020, EDM Group reported turnover of £37.8 million, slightly up from a year earlier. However, its post-tax profits fell from £5.2 million in 2019 to £2.7 million in 2020.
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This established IFA is assigned to one major platform ensuring a very smooth transition of client assets.
This is a highly profitable business with EBIT percentage of 33%, meaning money can be recouped quickly after a purchase.
With advisers and back-office staff in place, this business can be purchased and will keep running efficiently.
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