Grantham-based Belvoir Lettings set to buy rival firm for £6 million
Grantham-headquartered Belvoir Lettings is poised to buy a town based competitor in a deal worth more than £6 million.
Belvoir Lettings, which has its head office in London Road, has agreed to acquire franchise property sales and lettings business Newton Fallowell.
The total value of the deal is likely to be £6.3 million and will be funded through a share placing.
The agreement will have to be approved by shareholders at a meeting in London on July 28.
A spokeswoman for Belvoir Lettings said that Newton Fallowell, which has 31 branches across the region and has its head office in High Street, Grantham, would continue to trade under its existing name.
It is the first time that Belvoir Lettings has allowed a new acquisition to retain its branding.
She said: “This is testament to the strength of the Newton Fallowell brand.
She said that jobs would not be lost as a result of the deal.
The acquisition will be funded with an initial consideration of £3.9 million raised by the placing of 3.4 million ordinary shares, which will raise proceeds of £4.3m before expenses.
They are expected to be admitted to the London Stock Exchange’s junior market AIM on July 29.
A further payment of up to £2.3 million will also be paid subject to the amount of EBITDA (earnings before interest, tax, depreciation and amortization and an accepted guide to company performance) generated by Newton Fallowell from the date of completion of the deal to February 2017.
Mike Goddard, chief executive of Belvoir, said: “We are delighted to be announcing the acquisition of Newton Fallowell.
“This is an exciting milestone in Belvoir’s growth, considerably expanding the size of the group with a fantastic new brand to add to our portfolio.
“I’d like to thank our shareholders for their continued support and welcome our new shareholders as we continue to grow the business across the UK.”