Begbies Traynor (AIM:BEG) Group PLC, the corporate restructuring firm, said it bought Axiom Consulting & Investments Ltd and Ellayaan Ltd, which together trade as Mantra Capital, a London-based finance and insurance brokerage, in a deal expected to be immediately earnings enhancing.
According to a statement, the initial cost of the takeover is £4.5mln, made up of £4mln in cash and the issue of 352,361 new ordinary shares.
There is also a potential earn out of up to an additional £13.5mln via cash and shares, subject to delivery of material growth in profits over the next four years.
Begbies said the deal is in line with its strategy to increase the scale, quality and range of the group’s acquisitions.
Mantra will join the MAF Finance Group, which Begbies acquired in May last year, to form BTG (LSE:BTG) Funding Solutions, a national finance brokerage with expertise in several sectors, the statement said.
Last year, Mantra reported revenues of £4.2mln and pre-tax profits of £1.2mln.
"The acquisition of Mantra is in line with our growth strategy to complement and expand our services and regional coverage, whilst enabling us to form a national finance business serving a wide range of sectors,” said the executive chairman of Begbies, Ric Traynor.