K3 Aquires Three Companies in December

UK-based ERP and supply chain software provider K3 has acquired Retail Systems Group Ltd (RSG), a provider of Microsoft Dynamics RMS to retailers in the UK and Ireland for £1.28 million payable in cash on completion, with an additional payment of approximately £1.5 million in respect of surplus cash in the business at completion.

With the acquisition K3 has access to market for smaller retailers, complementing its existing mid-range retail software offering. RSG's managed service division will also further expand K3's own growing managed services division, according to the company. RSG has approximately 200 customers, including Aston Martin, Highgrove House, Triumph and the National Portrait Gallery.

For the year to 30 June 2011, RSG had sales of £2 million and an operating profit of £300,000. Approximately 40% of annual revenues are recurring, derived equally from managed services and maintenance/support. A further 35% of annual revenues are typically from additional sales to existing customers, company officials said.

"RSG represents another excellent acquisition for K3," said Andy Makeham, Chief Executive of K3, in a statement. "We already have an established business delivering retail software solutions to mid-tier retailers and RSG will extend our reach into the substantial small retailer market."

Makeham said the acquisition also brings K3 strong recurring revenues, in part, from its managed services clients.

In December, K3's also acquired Integrated Business Systems for up to £1.6 million and Unisoft BV for £2.4 million.

In November K3 acquired Shine Marketing, a web design agency for ecommerce retailers and brand owners, as part of its push to become a supplier of end to end multi-channel solutions and services.

In July, K3, bought FD Systems Ltd, a Sage and e-commerce provider, for £2.23 million in cash on completion. ...