Alcumus Upcoming Sale
Relevant Document:
Financial Report FY’20
Direct lenders are monitoring the upcoming sale of U.K. risk management and supply chain solutions provider Alcumus. The Inflexion-backed company is working with investment bank Harris Williams and is expected to start the sale process in the coming weeks, sources told Reorg.
Alcumus is being marketed off EBITDA of £35 million and the sell-side is targeting a valuation multiple of 20x, sources said. The sale process is expected to be competitive and likely to attract sponsors and direct lenders keen to replace incumbent lender Alcentra with leverage levels north of 6x, sources said.
In 2020, the company’s reported revenue increased 18% year over year to £54.7 million and the EBITDA for 2020 was £19.7 million.
As at Dec. 31, 2020, the group’s total debt amounted to £197.6 million. Alcumus’ cash and cash equivalents were £12.1 million and net leverage was 9.4x. The company also had a £5 million revolving credit facility due in November 2024, which was undrawn at the end of 2020.
In December 2020, the company issued £20 million of PIK notes to Alcentra which are repayable in December 2025 and interest is charged at 12%, according to the report.
The company’s capital structure is below:
Alcumus Group Ltd.
|
12/31/2020 |
|
EBITDA Multiple |
(GBP in Millions) |
Amount |
Maturity |
Rate |
Book |
|
Finance Leases |
1.3 |
|
|
|
Total Finance Lease Liabilities |
1.3 |
|
0.1x |
£5M RCF due 2024 |
- |
Nov-2024 |
|
|
£30M Bank Loan (Facility B1) due 2025 |
30.0 |
2025 |
GBP LIBOR + 2.750% |
|
£103M Bank Loan (Facility B2) due 2025 1 |
104.7 |
2025 |
GBP LIBOR + 7.000% |
|
Total Bank Debt |
134.7 |
|
6.9x |
£20M PIK Loan Notes due 2025 |
20.0 |
Dec-2025 |
12.000% |
|
Shareholder Loan Notes 2 |
41.6 |
|
12.000% |
|
Total Shareholder and Other Debt |
61.6 |
|
10.0x |
Total Debt |
197.6 |
|
10.0x |
Less: Cash and Equivalents |
(12.1) |
|
Net Debt |
185.5 |
|
9.4x |
Operating Metrics |
LTM Revenue |
54.7 |
|
LTM Reported EBITDA |
19.7 |
|
|
Liquidity |
RCF Commitments |
5.0 |
|
Plus: Cash and Equivalents |
12.1 |
|
Total Liquidity |
17.1 |
|
Credit Metrics |
Gross Leverage |
10.0x |
|
Net Leverage |
9.4x |
|
Notes:
1. Includes additional amount of £13M issued under the facility B2.
2. Maturity includes £846k due Dec. 2022 and £38.95M due Dec. 2023. |
Inflexion acquired Alcumus in 2015 for £92 million, according to a
statement at the time. Since the sponsor’s investment, Alcumus has grown through various bolt-on acquisitions such as the buyout of U.K. integrated health and safety and environment risk management services
Santia for £47 million in 2015. Other acquisitions include e-compliance business Canadian ContractorCheck Inc. in 2019 for £26.2 million and U.K. software company Banyard Solutions Ltd. in June 2020. More recent acquisitions include U.K. software company Simple Compliance and software as a service and compliance provider Mango, both acquired in 2021.
Alcumus is a risk management and ESG platform that delivers software technology-enabled services in the areas of environmental, health and quality management to companies of all sizes. The company has more than 750 employees across offices in the U.K., North America and APAC and serves 45,000 customers globally.
--Lucía Camblor