Blancco Technology Group PLC Acquires Xcaliber Technologies LLC and Xcaliber IP LLC

The Group is pleased to announce the acquisition of the remaining stake it does not already own in Xcaliber Technologies and a significant new contract win.

Acquisition of remaining shares in Xcaliber

The Group has acquired the remainder of the share capital (51%) of Xcaliber Technologies LLC and Xcaliber IP LLC, a privately owned provider of mobile diagnostics software, for a consideration of $5.5 million (£3.8 million using todays spot rates) of which;

• $0.8 million (£0.5 million) is an upfront cash payment funded through the Group revolver facility; and
• A further estimated earn out payment of $4.7 million (£3.3 million) payable over 3 years depending on the business achieving certain revenue targets.  The earnout would be payable in cash.

The acquisition takes the Group's stake in Xcaliber to 100%.

On a trailing twelve month basis to 31 December 2015 Xcaliber had revenues of $1.5 million (£1.0 million), growing at strong double-digit rates, and an operating loss of $0.9 million (£0.6 million).  At 31 December 2015 it had a balance sheet value of net liabilities of $0.2 million (£0.1 million).

The acquisition further strengthens the Group's product offering and allows the Group to bundle and cross sell its diagnostics solutions and Blancco's market-leading erasure solutions to the same clients. 

The founder of Xcaliber will stay with the business for six months for a handover period.

Contract win

The Group is pleased to also announce that Xcaliber has secured a multi-year contract to roll out its retail diagnostics solution to all the retail outlets of a major North American mobile phone operator and retailer.  This will cover more than 5,000 retail outlets, and allow the end customers to diagnose over 60 faults with their mobile and tablet devices in store and avoid unnecessary repairs. 

This contract is an extension of a previous 200-store trial, and establishes Xcaliber as a Global market leading player in the mobile diagnostics field, in terms of reach and distribution.

This contract roll out has commenced and, after an implementation period, related costs and working capital investment, is expected to contribute to revenue and profit growth in FY 2016. 

Matthew Peacock, Non-Executive Chairman of Blancco, said:                       

"This acquisition completes a strategic investment programme which has brought Blancco, Tabernus, Safe IT and Xcaliber together into a market leading stand-alone Software Group focused on maximising the considerable opportunities in secure, auditable data erasure. We are delighted that Xcaliber has signed such a significant contract in the exciting US market, which demonstrates the strength of its offering and the scope for further growth."