Digital Barriers plc Acquisition of Codestuff Ltd
Digital Barriers plc (AIM: DGB) ("the Company"), the specialist provider of products and services to the homeland security market, is pleased to announce the acquisition of Codestuff Ltd ("Codestuff") (the "Acquisition").
Based near Edinburgh, Scotland, Codestuff is the developer of a range of best-in-class IP video solutions for the security, infrastructure, transportation and defence industries. Operating primarily in the UK, Codestuff's solutions include video management system ("VMS") software and network video recorder ("NVR") servers, in addition to system design and development services that build on its extensive video management platform. Codestuff offers its solutions to a variety of leading players in the CCTV and security industries, as well as a number of OEMs, and is an existing supplier of VMS technology to Digital Barriers.
Rationale for the Acquisition
The board of directors of Digital Barriers (the "Board") believes that Codestuff brings significant video management IP and system development tools and will enhance the Company's ability to offer a leading-edge capability in the design of front-end systems for security technology. This capability will allow Digital Barriers to more effectively and coherently deploy its existing and any newly developed or acquired IP in the tailored, scalable, easy to use and integrated manner demanded by its customers to meet specific operational requirements. This will include Digital Barriers' advanced surveillance offerings to the aviation, rail, oil and gas and defence sectors, and will bring together video, unattended ground sensing and other core technologies within the Company.
Codestuff also brings to Digital Barriers a compelling product set that is both additive and complementary to Digital Barriers' existing IP. Codestuff's product set includes the well-regarded "Quorum" VMS range of solutions, which should bring additional scale to Digital Barriers in this market.
Terms of the Acquisition
Under the terms of the Acquisition, Digital Barriers will acquire the entire issued share capital of Codestuff for an initial consideration of £750,000, payable to the vendors of Codestuff upon completion of the Acquisition in cash, subject to certain debt-like deductions.
Dependent upon the successful satisfaction by Codestuff of significant financial and operational targets in the period from completion of the Acquisition to 31 March 2014, additional payments up to a total of £750,000 may be made by Digital Barriers in cash.
Codestuff's latest unaudited accounts for the financial year ended 31 January 2012 report turnover of £0.60 million with an operating loss of £0.06 million. As at 31 January 2012, Codestuff had net liabilities of £0.02 million.
Colin Evans, Managing Director of Digital Barriers commented:"Codestuff not only brings to Digital Barriers a suite of significant and extremely well regarded IP, but also the capability to integrate that IP into a wide range of coherent, integrated systems. As a company we already partner with Codestuff and have an excellent long-standing relationship with them. This acquisition will allow Digital Barriers to enhance the ways in which our customers use, interact with and respond to the leading-edge technology we already deploy in video surveillance and unattended ground monitoring. I look forward to working with the Codestuff team and welcome them to our company."