The acquisition will see 450 JL staff join Mears’ growing army of maintenance specialists as consolidation continues in the sector rocked by the demise of Connaught.
Bob Holt, Chairman of Mears, said: “The acquisition of the JL business fits comfortably into our social housing division and broadens our footprint in the North West of England.
“I am delighted to welcome a further 450 employees into the Group. We continue to seek to acquire businesses with the potential to meet the strategic objectives of the Group.”
The deal involves £2.7m in cash and the repayment of £2.1m of net debt with a possible extra payment of £1m subject to future performance.
JL has an order book in excess of £80m and for the 15 month period ended 31 March 2010, unaudited accounts show that the business generated revenues of £38.6m and a loss before tax of £3.8m.
The last audited accounts, for the 12 month period to 31 December 2008, reported revenues of £31.5m and a loss before tax of £0.4m. Gross assets as at 31 December 2008 were £8.6m.
The business has recently gone through a restructuring whereby overheads have been significantly reduced together with an increased focus on underlying operating margin.
The completion balance sheet reports net liabilities in the region of £1.4m including a net debt of £2.1m which was repaid immediately upon acquisition from the Group’s existing banking facility.
Mears expects to generate further significant cost and efficiency savings and the principal benefits of the acquisition are anticipated to arise in 2011 and beyond with JL expected to be earnings neutral for the year ending 31 December 2010 (before the costs of restructure) and earnings enhancing for the year ending 31 December 2011.