Begbies Traynor buys CJM Asset Management

AIM-listed Begbies Traynor has announced the acquisition of Fyrebrand Limited, which trades as CJM Asset Management, for an initial consideration of £250,000, in a deal that is expected to be earnings-enhancing in the group's current financial year and after any additional consideration is paid.

Established in 2000, CJM specialises in the sale of industrial plant and machinery assets through its online platform, physical auction centre and private treaty sales. It has large industrial clients as well as private clients and local authorities. Begbies said the group will be combined with its existing Eddisons machinery and business asset disposal activities, operating as Eddisons CJM.

In the year to the end of November 2017, CJM reported revenue of £1.2m and pre-tax profit of £100,000.

Of the initial £250,000 paid by Begbies, £150,000 will be satisfied in cash from existing resources, with the rest raised through the issue of 134,462 new ordinary shares at 5p each. There will also be an additional contingent consideration of up to £300,000, payable subject to the achievement of stretching financial targets for the consolidated machinery and business asset disposal business in the three year period directly following completion.

Begbies executive chairman Ric Traynor said: "The acquisition of CJM is in line with our strategy to develop our property services division, to increase both the scope of its service offering and geographical coverage. In particular, CJM's client base is highly complementary with our existing machinery and business asset disposal activities, which are primarily focussed on the sale of assets out of insolvencies."

At 1130 GMT, Begbies shares were down 0.8% to 73.60p.