ENERGY Assets, the Scottish gas meter specialist, has made its first big move into the electricity meter market by acquiring a Lancashire-based firm for £2.3m cash.
Livingston-based Energy Assets said the purchase of the BGlobal Metering business from Bglobal group will allow the company to become a leading player in the market to supply smart meters that companies can use to monitor their power consumption.
Chief executive Phil Bellamy-Lee described the deal as a significant step in the delivery of the group's strategy to offer services across a range of utilities.
Loading article content
The acquisition will result in a big increase in the number of meters that Energy Assets provides to and monitors for customers in the industrial and commercial markets on which it focuses.
BGlobal Metering provides 60,000 meters to customers and collects information from 90,000.
Energy Assets had 101,000 meters installed at clients' facilities at March 31, including hundreds of electricity meters. It collected information from 62,500 meters.
The company is confident both arms of the enlarged business will be able to capitalise on regulatory changes intended to help reduce power consumption and associated carbon emissions.
These are fuelling demand for smart meters.
It expects the electricity and gas meter operations will cross-sell their services to each other's customers.
BGlobal Metering made a pre-tax loss of £1.5m on sales of £7.4m in the year to March 2013.
However, Energy Assets said it expected the business will be earnings enhancing within 12 months of the acquisition.
Chief financial officer John McMorrow appeared unconcerned that Bglobal was involved in controversy last year.
In October the group said its chief finance officer, Nick Kennedy, had been dismissed with immediate effect following an investigation of his conduct.
His father, Peter Kennedy, was removed as executive chairman following a vote at Bglobal's general meeting in August.
Mr McMorrow said Energy Assets had completed due diligence on BGlobal Metering.
He noted: "We are confident about the sales pipeline and the quality of the people."
BGlobal Metering employs around 50 people in Blackburn and all of them are expected to join Energy Assets.
Mr McMorrow said Energy Assets will consider making further acquisitions.
Energy Assets added 27,000 data-loggers through the £13.5m acquisition of Gazprom's Global Energy Solutions business in October 2012.
Shares in Energy Assets closed the trading day up 6%, or 20p, at 345p.