Acquisition of B2B Customer Book
9 November 2020
Yü Group PLC
("Yü Group" or the "Group")
Acquisition of B2B Customer Book
Yü Group PLC, the independent supplier of gas, electricity and water to the UK business sector is delighted to announce the acquisition of the business customer book of a Midlands-based energy group.
Transaction highlights
· The acquisition will add c400 meter points to Yü Group's current meter portfolio of c14,000.
· The Board expects the acquisition to be earnings enhancing from mid-November 2020.
· The customer book consists of gas contracts to small and medium sized businesses across Great Britain.
· The Group will hedge the book based on lower gas commodity markets, leading to attractive margins.
Information on the assets acquired
The customer book has been acquired from a Midlands-based group, which is divesting its mains gas supply book to focus on its core activities. The customer book consists of gas contracts to a diverse customer base, operating within sectors including healthcare, manufacturing and retail.
The acquired business reported c£3m of unaudited revenue for the year ended 31 March 2020.
Strategic rationale
The customer book has already been integrated into the highly scalable Yü Group platform and will complement strong organic growth. With the customer book consisting of gas contracts there are clear opportunities for Yü Group to provide additional products and services including electricity and water. Further, Yü Group's ability to hedge commodity volume on lower forward commodity market prices will ensure the customer book delivers attractive margins.
Terms of the Acquisition
Yü Group will pay £0.2m in cash for the assets, which includes an element of consideration based on a discount to the customer receivables balance acquired, net of provision.
Bobby Kalar, Chief Executive of Yü Group, commented:
"We are delighted to be adding these additional customers to our highly scalable platform.
We have already successfully migrated the customers with the acquisition being imminently earnings enhancing with no noticeable additional cost to serve. Beyond this, there is further value we can provide our new customers with the additional products and services we offer.
Following the recent successful acquisition and seamless integration of Bristol Energy, this acquisition clearly demonstrates our abilities to strategically grow our business. We now have a proven template for deals to complement our accelerating organic portfolio. We see a number of further opportunities in the market, and combined with our continued significant organic growth, are excited by the future."
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.
For further information, please contact:
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Yü Group PLC Bobby Kalar Paul Rawson
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+44 (0) 115 975 8258
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SP Angel Corporate Finance LLP Jeff Keating Bruce Fraser Caroline Rowe
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+44 (0) 20 3470 0470 |
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Tulchan Group David Allchurch Giles Kernick
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+44 (0) 20 7353 4200
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Notes to Editors
Information on the Group
Yü Group PLC, trading as Yü Energy, is an independent supplier of gas, electricity and water focused on servicing the corporate sector throughout the UK. It has no involvement in the domestic retail market. The Group was listed on the AIM market of the London Stock Exchange in March 2016. For 2019 the Group had revenue of c. £112m.
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