Arena buys The Structure Group assets and rest of Hong Kong operation

27th Sep 2018 14:58

(Sharecast News) - Arena Events Group has expanded its product portfolio with the acquisition of the UK and Middle East temporary structures business from the Structure Group of Companies (TSG), it announced on Thursday.The AIM-traded firm said the acquisition would bring TSG's UK and Middle East product, staff and contracts into the group, with its core product range including a steel frame panel system, known as the 'TSG Heavy Deck'.It said the product could be utilised for temporary showrooms, viewing decks, multi-story structures, mezzanines and temporary modular buildings which were unlike traditional tent structures.Arena already owned some TSG product in the Middle East, which had been used for several high-profile events, including the Abu Dhabi Golf Championships this year.The acquired business had a "wide range" of customers in the UK, including Honda and Tesla at the Goodwood Festival of Speed, the board said.It explained that the total consideration payable was £1.35m, paid in cash at completion, and funded from existing cash resources.The acquisition was in line with Arena's growth strategy of complementary product expansion, and would reportedly strengthen the company's offering to existing clients as well as attract new clients.In the last 12 months, it was estimated that the acquired assets and contracts generated EBITDA of around £0.25m and profit before tax of about £0.15m.Arena also announced that is had exercised its option to acquire the remaining 49% shareholding of its Hong Kong subsidiary, Arena Hong Kong.It said Arena Hong Kong provided temporary structures to a number of major events in the special administrative region, including the Kong Hong Rugby 7's, the Hong Kong Open golf, Formula E and the Art Central exhibition.The consideration for the Arena Hong Kong transaction was £0.9m, paid in cash at completion and funded from existing cash resources.In the 12 months to 31 December 2017, Arena Hong Kong achieved EBITDA of £0.35m and profit before tax of £0.3m.The book value of fixed assets in the company as at 31 December was £0.4m.That transaction, together with the recent acquisition of Ironmonger Group in Hong Kong,, meant that the Arena Group now had "full control" and exclusive rights to deliver and operate the hospitality for the Hong Kong Rugby 7's for the next five years."TSG's products and expertise will assist the group in delivering innovative temporary structures and help deliver further growth within this sector," said Arena group chief executive officer Greg Lawless."We are delighted with the opportunity to bolster our services and better serve the increased demand for innovative temporary structures in the UK and MEA."