MBH Corporation Plc (FRA:M8H) hailed its fifth acquisition of 2020 and established a new transport division as it snapped up a UK taxi and food delivery company.
Ashley David Taxis (ADT), which is in the process of rebranding as Driven by Riide, has been acquired for a total consideration of £3.4mln, of which the majority is being settled by way of a listed bond.
The acquisition represents the 14th company in the group and lifts pro forma revenues for the past calendar year to £85.4mln.
With 150 vehicles and 600 drivers operating in and around Leicester, ADT generated audited revenues of £3.9mln and underlying profits (EBITDA) of £0.8mln in the 11 months ended April 30, 2020.
The firm has developed its own pre-pay app, where around 70% of bookings are made, and as a taxi company has a significant advantage over private hire vehicles as its cars are allowed to wait in taxi ranks and be hailed on the street.
In addition, as a response to changing consumer needs in the face of the coronavirus pandemic, ADT has introduced a food delivery service called EatMe app.
With the outfit undergoing an expansion phase with a view to doubling its driver numbers to 1,200, MBH said the deal “will allow the company to achieve this significant growth in scale”.
In a statement, David Hunter, chief executive officer of ADT, said it was a “pivotal moment” for the company.
“We have strong growth ambitions which MBH will be instrumental in helping us achieve; in the next 18 months our aim is to buy other fleets and expand our network and rebrand with a national tech-focused name.
“Our further ambition is to merge other profit-making private hire fleets under one company and brand and to streamline them and modernise them to cloud-based fleet management companies. I am very excited about the future and our potential with MBH.”
MBH CEO Callum Laing added: “As David commented, it's an exciting moment both for his company and the industry in general - that has faced challenges from increased competition over the past years, but that is now poised for significant growth.
“As we move into a scenario where last-mile logistics become increasingly valuable, having the experience and the network of drivers that Driven by Riide has will prove critical. People, parcels or your dinner, Driven by Riide will ultimately be able to deliver.”