Pennant International Group PLC (AIM:PEN) has acquired the rail services company Track Access Productions Limited (TAP) in a move the training solutions group said will “significantly” enhance its own rail offering, while also boosting recurring revenues.
The acquisition consideration, which is being funded from Pennant’s existing cash, comprises an enterprise value of £585,000, plus around £389,000 in respect of TAP's 'free cash'.
Bedfordshire-based TAP provides driver training, route mapping and route familiarisation services to the UK rail industry, including train and freight operating companies, engineering contractors and infrastructure providers.
In a statement, Pennant CEO Phil Walker commented: "TAP is an excellent business with a long-standing, trusted reputation in the UK rail market and we look forward to working together to integrate TAP into Pennant's growing rail offering."
TAP recorded revenues of around £600,000 and pre-tax profit of £200,000 in the year to 31 March 2023, up from £481,000 and £180,821 respectively in the previous year.
Following the acquisition, the combined track services unit is expected to generate revenues for 2023 in the region of £850,000, Pennant said.
Shares rallied 2.7% to 38.00p in early trade.