Begbies Traynor buys Pugh Auction Group for £2m

Property services group Begbies Traynor said it had bought Pugh Auction Group for £2m in cash.

Begbies said Pugh's 25 staff, including management, would be integrated with the group's existing Eddisons property services division.

Pugh & Co was established in 2000 and is the largest firm of commercial property auctioneers operating outside of London, with regular auctions held in Leeds and Manchester.

In the financial year ended 31 March 2016, Pugh & Co reported annual revenue of £2mon and pre-tax profits of £0.8m. It had gross assets of £0.1m at 31 March 2016.

Under the terms of the deal, an extra £2.625m would be payable subject to the achievement of “stretching financial targets” for the consolidated auctions business in the five year period directly following completion, Begbies said.

Up to £0.25m is payable based on meeting financial targets in the first year post acquisition and may be satisfied through either the issuing of new ordinary shares at the prevailing market value or cash, Thes rest would be in cash over the five year period post acquisition.

Begbies said it expected the acquisition to be earnings enhancing both initially, in the group's current financial year which started on 1 May 2016, and after any additional consideration is paid.