LONDON, UK: Mitie Group plc has entered into a sale and purchase agreement (‘SPA’) to acquire the entire issued share capital of Custom Solar Ltd, a solar power solutions company specialising in the development, design, installation and maintenance of solar power systems for public and private sector clients.
Custom Solar’s design and installation expertise, combined with Mitie’s industry leading project management and mobile engineering offering, will support Mitie’s ambition to be a leading provider of end-to-end green energy solutions.
The transaction consideration comprises an initial payment of £8m, with deferred payments in aggregate of up to £4.4m by the end of FY25, linked to performance targets.
Custom Solar will be acquired cash free, debt free, with a normalised level of working capital. The transaction is expected to complete on 30 June and will be funded through existing facilities. For the 12 months ended 31 March 2022, Custom Solar generated revenues of £15m and profit before tax of £2m and had gross assets of £7m. Custom Solar is expected to be accretive to earnings in the first 12 months of ownership.
With the demand for sustainable energy solutions set to increase significantly, UK solar power generation is targeted to reach 40GW in 2030, up from current levels of 14GW1.
Mitie’s strategy is to fill a gap in the market for truly integrated solar solutions, building on its expertise in upgrading the electrical infrastructure and providing grid connections to support the UK’s decarbonisation agenda. This follows Mitie’s recent acquisition of Rock Power Connections which specialises in high voltage electricity grid connections, electrical infrastructure upgrades and EV charging installations.
The staff and senior management team of Custom Solar, including Managing Director, Matthew Brailsford, will join Mitie to help drive the business forward.
Simon Venn, Managing Director, Technical Services, Mitie, said: “The acquisition of Custom Solar continues Mitie’s strategy of investing in high growth, high return businesses within the energy and decarbonisation market to help our customers accelerate their path to Net Zero.
“Custom Solar’s expertise in large scale commercial solar deployments, combined with Mitie’s high voltage connection and project management expertise, will enable us to offer end-to-end renewable power generation at scale. With our client base including national brands, public sector organisations and critical infrastructure providers, this is yet another element of our support to help decarbonise Britain.”