LONDON: ldox plc, a supplier of specialist information management software and solutions, has agreed the disposal of its Compliance Operations business, to Sponge Group Limited for £9.0 million cash on completion.
The Compliance Operations business, part of Idox’s Content Division is based in Germany and Belgium and employs 48 people.
The transaction will see Sponge acquire the entire share capital of Idox Germany GmbH and Idox Belgium BV together with a number of UK-based customer contracts.
Idox Compliance is one of Europe’s leading providers of compliance solutions, providing customers with e-learning platforms focused on supporting organisations to comply with compliance law and regulation.
The Compliance Operations reported revenues of £5.3m, an adjusted EBITDA contribution of £1.2m and PBT of £0.3m in Idox’s financial year ended 31 October 2020. Gross assets as at 31 October 2020 were £5.4m. The disposal is anticipated to generate a profit on sale of £5.4m in the Group’s current financial year.
The proceeds of the disposal will be utilised to reduce Idox’s net debt (which stood at £16.1m as at 31 October 2020) and to continue to invest its organic and inorganic growth strategy.
Following the disposal, Idox’s successful Grants Consultancy business now makes up the entirety of its Content Division.
David Meaden, CEO of Idox said: “Our strategy, as stated in our recent FY20 results, is to build value as a public-sector focused software organisation. Whilst we are pleased with the progress of our Compliance business in the last two years, within our Four Pillars Framework, this transaction provides us with an opportunity to simplify operations within the Group and focus on our key markets, whilst at the same time providing the Compliance business with a more relevant owner in order to realise its own ambitions.
I look forward to seeing the continued success of the Idox Compliance team and products as it moves into its next phase with Sponge.”