The e-banking and international payment group is initially paying £1.72mln for Casco, with and additional consideration of £2mln to be paid depending on future performance.
Around £1.4mln of this will be funded from existing cash resources, with the remaining balance financed through the issue of 377,666 new shares at a price of 84.4p, a 0.5% discount to Equals’ close price on Monday.
Casco provides international payments for mostly corporate clients as well as infrastructure services for the sector. For the last 12 months, the company generated £3.3mln in revenues and a pre-tax profit of £200,000.
In addition to the enlarged client base, Equals says the acquisition of the infrastructure services business will provide “a new product and revenue stream” for the newly enlarged group.
Ian Strafford-Taylor, Equals’ chief executive, said the acquisition will enable the group to enter the service provision sector with a proven provider that will enable the firm to “penetrate this growing market at pace”.
“In addition, we are also acquiring an excellent international payments team and over 1,000 clients, most of which corporate clients, who will benefit from our existing proprietary technology and excellent operations teams”, he added.
Equals Group shares were steady at 84.8p in early deals on Tuesday.