Eleco acquires project portfolio software firm BestOutcome

27th Jun 2023 13:12

(Sharecast News) - Built environment software specialist Eleco announced the acquisition of BestOutcome, a leading UK provider of project portfolio management (PPM) software, on Tuesday.

The AIM-traded firm said the acquisition was made for an initial cash consideration of £4.825m, and would be funded exclusively by its internal cash resources.

It described BestOutcome as a profitable and high-quality software-as-a-service (SaaS) business based in Buckinghamshire.

The transaction also included a potential deferred consideration of £0.5m, subject to performance targets set for the BestOutcome management team in 2023 and 2024.

With the deferred consideration, the total potential consideration for the acquisition amounted to £5.325m.

In 2022, BestOutcome reported SaaS-related revenues of £2m and a profit before tax of £0.2m.

The unaudited management accounts for the first five months of 2023 showed revenue of around £0.9m, and a profit before tax of about £0.2m.

As of the end of May, BestOutcome had cash of £1.3m.

Following the acquisition, BestOutcome would continue to operate under its own brand, known as 'BestOutcome, an Elecosoft company'.

"The acquisition of BestOutcome represents another milestone in the development of Eleco as a leading provider of world-class software solutions to the built environment," said chief executive officer Jonathan Hunter.

"The addition of BestOutcome's simple, well designed, scalable PM3 portfolio management SaaS software to Eleco's existing software portfolio will enable Eleco to meet the needs of a diverse audience in the built environment.

"The incumbent directors and owners of BestOutcome have reinvested profits into building a world-class team and ensuring that the business is well-governed, achieving certification as a 'Great Place to Work' Cyber Essentials Plus and ISO27001 accreditation."

Hunter said the investment in research and development, through doubling its development team over recent years, made it stand out among peers as a "highly secure and practical" solution for planning and managing programmes for customers in public and private sectors.

"We look forward to working with our new colleagues as we solve the challenges of the built environment together."

At 1109 BST, shares in Eleco were up 4.45% at 78.34p.

Reporting by Josh White for Sharecast.com.