Published on: June 7, 2021

Earnings enhancing deal underscores focus

Idox has announced the earnings enhancing acquisition of Aligned Assets, a UK based public sector software business which provides solutions to local authorities and others for address databases. Following the disposal of the remaining parts of the Idox Content division earlier this year, Idox is positioned as a software business selling to public-sector and engineering customers. This acquisition immediately augments Idox’s offering to local authorities in line with its growth strategy and adds recurring revenues. Idox is paying up to £10.5m with £7.5m on completion and the rest subject to earn-out conditions over the next two years – a range of 5.4x to 7.5x expected EBITDA multiple. The cash is to be paid from existing resources which had been enhanced by the disposal proceeds. Our adjusted EPS estimates increase by 5% for FY 21E and 12% for FY 2022E and FY 2023E, (with the latter two being the first full years of ownership) and our net (debt)/cash numbers reflect the mooted consideration in full.