Castleton Technology sells Maxima Information

1st Sep 2014 09:31

Castleton Technology has signed a deal to sell Maxima Information Group (MIG) for £752,000 as part of its restructuring process. Of the consideration, £300,000 will be paid immediately, while a further £300,000 is due by 30 September and the remaining £152,000 is due by the end of March next year, if certain conditions are met. Castleton said it has already collected around £200,000 of annual maintenance revenues in the current year, meaning the exit enterprise valuation for the business is approaching £1m.It plans to use the proceeds of the sale to improve its position as a provider of IT managed services to the public and not for profit sectors."While the business contains a good software product and a skilled management team, it is clear to the board that the business requires investment and new commercial partners in order to sustain its market position and attract new customers," the group said. In the year ended 31 March, MIG generated £1.5m of revenue and £0.3m in pre-tax profit.Chief executive officer, Ian Smith, said: "The disposal represents the end of the restructuring of the Company and we can now focus fully on our strategy of building a leading provider of IT managed services to the public and not for profit sectors."The disposal includes MIG's trade and certain assets. The share price had risen 2.22% to 1.38p at the opening bell. NR