CareTech shares up on acquisition and funding news

29th Jul 2015 14:19

(ShareCast News) - Shares in CareTech rose after the social care company said it was acquiring a Scotland based care provider and had extended loan facilities.At 1346 BST shares in the AIM-listed stock were up by 2.51% to 245p.CareTech said it would by Spark of Genius for £9.23m, made up of £7.48m cash and an earn-out of up to £1.75m.Spark has 48 residential places in nine homes in Scotland and 100 educational places in three schools, and reported revenues of £10.9m last year, CareTech said in a statement.The acquisition was funded from existing resources and would be earnings enhancing in its first full financial year.CareTech also announced it has a new debt facility of up to £30m and had also deferred four loan payments totalling £21.6m.WH Ireland analyst John Cummins said the additional banking facilities put the company in a good position.Cummins held a 'buy' recommendation and raised his target price to 330p from 345p, while lifting full year earnings per share expectations by 3.8% and 5% respectively.