Feeds

Workplace snaffles LanBase

More consolidation in UK networking channel

  • alert
  • submit to reddit

Internet Security Threat Report 2014

Workplace Technologies is shelling out up to £19.56 million in cash and shares for the acquisition of rival networking equipment reseller LanBase Holdings. Berkshire-based LanBase increases the company’s turnover by more than £20 million. Judging from its historic growth rate of 20 per cent, LanBase should be on course for £24 million t/o for 1998. In its last interims, Workplace sales were £40 million. DKB is forecasting £79 million sales for the full year. Workplace also gains a foothold in the Spanish market through the acquisition of outstanding shares of Madrid-based LanBase Espana not already owned by LanBase Holdings. LanBase Espana sales are consolidated into LanBase Holdings figures and contribute around 8 per cent of turnover. Keith Berry, founder and MD of LanBase, is to join the Workplace board. The enlarged group aims to leverage better purchasing terms from its suppliers. Workplace is "3Com's biggest UK reseller, Cisco's fastest growing UK reseller and (following the acquisition of LanBase)the UK's largest Bay Networks reseller", according to Andrew Vaughan, Workplace MD. It also expects to achieve “key operational synergies such as training and stock management.” Workplace is presenting the deal as the next strategic step in the expansion of the company. Although LanBase trawls the same networking equipment market as Workplace, it brings a different customer base, concentrated in the London financial sector, and increased geographic coverage. LanBase will also deliver a big boost to Workplace's post-sales support business. Support contracts account for 20 per cent of LanBase turnover. The enlarged group operates out of 11 branches in the UK and Ireland, and will have a workforce of over 500. Redundancies are not envisaged "at present", according to Vaughan. "With the market growing at 20 per cent a year, there is plenty of opportunities for jobs," he said. Workplace’s historic strength is in cabling and maintaining data networks in gigantic buildings -- it numbers the Ministry of Defence and Hong Kong Airport Authority among its customers. The company blames late payments from the latter client for full-year interest charges that are “likely to be somewhat greater than current market expectations”. Berkshire-based LanBase produced operating profits of £1.52 million on sales of £19.9 million for the year to 31 December, 1997. Workplace is paying a maximum of £8.8 million in cash, £1 million in loan notes, and the issue of 6.5 million Consideration shares, dependent on LanBase achieving an operating profit of £2 million in the year ending 31 December, 1998. As it is November, LanBase shareholders must be pretty sure of hitting their target. Certainly, they are highly incentivised to hit the £2 million operating profit target. For every £100 profit shortfall their payout is chopped by £520 in cash and 338 consideration shares. LanBase owners have also warranted that the companies net assets will be at least £2.1 million on 30 November, 1998. Any shortfall will be adjusted pound for pound in the payment. There is plenty more goodies to come for LanBase shareholders, as Workplace is buying only 68.8 per cent of the share capital of LanBase Holdings and the 49 per cent of shares in LanBase Espana not owned by LanBase Holdings. The outstanding balance of LanBase shares are covered by option agreements. Workplace has the right to acquire up to 24.7 per cent of the 31.2 per cent optioned shares after 2 January, 1999,on the same terms as the first tranche. Workplace needs shareholder approval to wave through the deal. Vaughan is confident the deal will get approval. "This is our first acquisition and it is low-risk...Lanbase is a good, solid growing business." The company was advised on the acquisition by Hawkpoint Partners. ®

Providing a secure and efficient Helpdesk

More from The Register

next story
Scrapping the Human Rights Act: What about privacy and freedom of expression?
Justice minister's attack to destroy ability to challenge state
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
EU to accuse Ireland of giving Apple an overly peachy tax deal – report
Probe expected to say single-digit rate was unlawful
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
Hey Brit taxpayers. You just spent £4m on Central London ‘innovation playground’
Catapult me a Mojito, I feel an Digital Innovation coming on
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
EU probes Google’s Android omerta again: Talk now, or else
Spill those Android secrets, or we’ll fine you
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.