CVS Group acquires YourVets in £12m deal

30th Mar 2015 11:30

Veterinary services provider CVS Group confirmed it will acquire sector peer YourVets in a deal worth £12m.The London-listed company said it had secured new debt facilities with Royal Bank of Scotland to finance the deal, adding it will pay approximately £9.5m of the purchase price, with the remaining £2.5m payable in loan notes bearing a 10% annual interest.The agreement with RBS, which includes a fixed term loan of £32m, a revolving credit facility of £48m and a £5m overdraft facility, will provide CVS funds to support its investment strategy over the next few years."The new borrowing facility provides CVS with the flexibility, at a comfortable level of gearing, to fund the ongoing development of the business across multiple organic growth initiatives together with additional acquisition opportunities," said group chief executive Simon Innes.Midlands and Essex-focused YourVets reported annual revenue of £9.2m in the year to 31 March 2014, while earnings before interest, tax, depreciation and amortisation were £200,000 and net assets amounted to £2.4m.For the financial year ending on 31 March this year, the company's sales are expected to be approximately £10m, with EBITDA forecast to amount to £800,000.CVS said it will acquire YourVets's net debt of £2m with the purchase, adding that intangible assets and goodwill of approximately £12.6 are also expected to arise on acquisition.CVS shares were up 1.50% to 507.50p at 11:50 on Monday.