Castleton Technology increases market share with £10m of acquisitions

1st Jun 2015 10:47

Castleton Technology announced its acquisition of Impact Application and Brixx Solutions for £5m each on Monday, swelling its housing association support portfolio to 400 of the UK's 1,700.The Cambridge-based software and managed services provider said the takeovers fortify its strategy to become the "pre-eminent supplier" to the social housing sector.Impact Applications, a provider of business critical repairs management and scheduling tools, is predicted to generate £2.8m in revenue, and EBITDA of £0.8m in the year to the end of August.Brixx, which offers software enabling users to produce financial models and forecasts, is expected to bring in £1.3m of revenue and EBITDA of £0.8m in the 2015 calendar year.In total, the deals have pushed the group's run rate revenue up to £18m, of which £9m is recurring.Castleton chief executive Ian Smith said: "Nearly a third of all the social housing associations in the UK are now Castleton customers. The scope to provide multiple service lines to our customers, combined with the opportunity for cost saving synergies between our businesses, gives me great confidence that Castleton will continue to deliver for its shareholders."The acquisitions will be funded by Castleton's cash resources, alongside a new banking facility with Barclays, providing a £5m loan and an overdraft of £2m.Castleton was advised on the deals by MXC Capital Advisory, a subsidiary of MXC Capital which owns 23.4% of Castleton's issued share capital.As of 11:30 BST, Castleton shares were trading 4.17% higher at 2.5p.