Cpl announces the acquisition of RIG Healthcare
Cpl Resources plc, Ireland's leading employment services group, is pleased to announce that it has agreed to acquire 91% of RIG Healthcare Group, a specialist healthcare recruiter in the UK. Cpl also provides trading update for the full year to 30 June 2017.
Acquisition of RIG Healthcare Group
Cpl has agreed to acquire a 91% shareholding in RIG Healthcare Group ("RIG") for a cash consideration of £8.1m. RIG Healthcare Group, the trading name of RIG Locums Limited and RIG Medical Recruit Limited, is a UK specialist healthcare recruiter with a focus on market niches within the Locum Doctors and Allied Health Professions and has a geographic footprint of five offices across the UK.
In the year ended 31 December 2016 RIG Healthcare Group generated sales of £53.5 million and normalised EBITDA of £2.0m. Cpl expects the investment to be earnings enhancing from the date of completion.
RIG supplies qualified medical professionals to the UK's National Health Service (NHS) with a particular focus on radiography, occupational therapy, pharmacy and physiotherapy. Healthcare recruitment, staffing and training has long been one of Cpl's most important sectors in Ireland & the UK and RIG will complement the Company's existing portfolio of healthcare brands which include: Cpl Healthcare, Kate Cowhig International Healthcare Recruitment, Servisource Healthcare and Private Homecare. The acquisition is Cpl's entry to the locum doctor market and enhances the Company's operating presence in the UK, following the acquisition of Clinical Professionals in September 2015.
The existing management team of Mr Affi Khan and Mr Rob Bryan will remain with the business and are co-investing in RIG as part of this transaction. Mr Khan, currently Managing Director of RIG will assume the role of CEO of RIG. Mr Bryan has been appointed to the role of Managing Director. Mr Khan and Mr Bryan are committed to growing the RIG business as part of Cpl and have invested in a 9% shareholding in RIG alongside Cpl.
We announced our half year results on 26 January 2017 for the six months to 31 December 2016. At that time, we reported growth in revenues and profits in the group. During the second half, issues relating to Brexit and changes to the US administration have caused some uncertainty and, in turn, delays in our market, affecting some of our services and sector mix. These events have been positive for our temp and contractor businesses, but have had a negative impact on permanent placements in some business sectors and markets.
For the year to 30 June 2017 we expect our revenues to be in line with market expectations, and our profit before tax to be slightly lower than current expectations.
Our strong track record of positive cash generation, gives the Group the flexibility to invest in acquisitions while at the same time maintaining strong capital returns. The Group cash reserves post the acquisition consideration are in excess of €28 million.
We plan to announce our full year results on 7 September 2017.
Anne Heraty, CEO of Cpl said:
"We are very pleased to expand our presence in the UK and welcome the highly talented professionals from RIG to Cpl. The recruitment expertise and international talent pool of doctors and healthcare professionals provided by RIG brings immediate strategic value to Cpl's broad portfolio of innovative workforce solutions in the healthcare sector. This acquisition also allows us enter into doctor recruitment which will deliver real value for our clients."
Mark Buckley, COO & Deputy CEO of Cpl said:
"We are very excited about the acquisition of RIG which has a strong and growing business serving the NHS and the wider healthcare sector in the UK. It delivers on our stated strategy of growing our business across the healthcare, pharma and life science sectors; and, within the UK market. The acquisition underscores our ability to identify and acquire attractive and complementary businesses which can accelerate growth under the Cpl brand."
Affi Khan, CEO of RIG said:
"Our vision is totally aligned to that of Cpl and our entire management team is very excited about the growth potential this acquisition offers RIG. This marks the next stage in the evolution of our brand and we are delighted to be the part of the Cpl family"