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React adds Fidelis Contract Services to group in maiden acquisition

Mon 29 March 2021 08:47 | A A A

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(Sharecast News) - Cleaning and decontamination company React Group said on Monday that it had agreed to acquire Birmingham-based hygiene services outfit Fidelis Contract Services.

React stated the acquisition, its maiden one, was expected to be immediately earnings enhancing and represented "an important step" in its stated growth strategy.

The AIM-listed group will make an initial consideration of £1.70m, payable as to £1.50m in cash from existing resources and £200,000 through the issue of new ordinary shares at a price of 2.1p per share.

Deferred consideration payments of up to £3.05m, subject to the audited financial performance of Fidelis in the current trading year ending 31 March and 2022, will be settled in cash and paid in instalments, with the final payment being on 29 March 2024.

Chairman Mark Braund said: "We are delighted to announce the acquisition of Fidelis today, our maiden acquisition and an important milestone in our stated goal to become the country's most trusted name in the provision of specialist cleaning, decontamination and hygiene services.

"The combination of our recent organic growth and the Fidelis acquisition leaves us well positioned to deliver material growth in the current financial year."

As of 0845 GMT, React shares were up 6.84% at 2.11p.

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