SMART Metering Systems chief executive Alan Foy has categorically stated the company is not for sale.
Speaking after the company’s annual meeting in Glasgow, Mr Foy said: “We haven’t had any approaches from anyone about acquiring the business. We are not for sale.”
His comments come weeks after sector stablemate Energy Assets agreed to be taken over for £198 million by funds run by US private equity firm Alinda Capital Partners.
Both Smart Metering Systems (SMS) and Energy Assets floated on the alternative investment market within eight months of each other in 2011/12. Smart Metering Systems has a market capitalisation of £360 million.
The Glasgow-based company – which last year saw a near 60 per cent boost in pre-tax profit to £17.5 million on revenue of £53.9m – is gearing up to take advantage of a Government ambition for all UK households to have a smart meter by 2020. Currently, just four per cent of the UK’s 53 million households have such a meter installed.
Mr Foy said the next year would be one of positioning after a flurry of acquisitions that have grown staff numbers from 60 at the time of its initial public offering, to just under 700. “It’s all about positioning ahead of the smart meter roll out,” said Mr Foy. “We’ve gone from a business that sub contracted, that built our own IT, and reinforced that with [acquisitions in]electricity, direct labour and IT professionals and we are now a very large business.”
In March the company announced the acquisition of energy meter installation firm CH4 Gas Utility and Maintenance Services, installation service provider Trojan Utilities, and IT firm QTon Solutions.
Mr Foy said each acquisition it had made had helped bring together “all the ingredients” for the domestic roll out of smart meters.
“Between [the businesses we’ve acquired], they’ve installed around a third of all domestic smart meters so we’ve got a third of the current labour across the UK,” said Mr Foy.
Earlier this year the company signed agreements to supply domestic meters for five independent energy firms including Our Power. It also supplies meters to business customers of British Gas.
My Foy said he expected challenges ahead with the scale of the domestic roll out, but said it was conceivable for the target to be met. “The pinch points could be direct labour. That’s why we have training centres. That’s why we’ve got direct labour organisations. We need the ‘man in a van’ to do it, that’s one of the challenges.”
He added that the company was well prepared, having invested in capacity. “We always invest in capacity and then go and deliver,” he said. “We don’t do it the other way around and that’s how we’ve maintained our reputation for delivery.
“Quite what that’s going to be going forward, historically that’s been quite substantial growth and there’s a big market in front of us, but we’ll keep that under review.”
As previously announced Smart Metering System’s annual meeting saw former Scottish Power executive Willie MacDiarmid assume the chairmanship of the business from Paul Dollman, who is stepping down.
“Paul’s been fantastic for the business,” said Mr Foy. “Willie McDermott comes in with our market capitalisation at [about] £350 million, we want to grow the business, we want to introduce and refresh the skills on the board and update ourselves with best governance strategies.”
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