Executive recruitment company Garner is buying the much larger executive search company Norman Broadbent for £5.5m.
The money will be paid in quarterly instalments. However, if less than £2.8m is owed 30 months after 30 September 2008 then the rest will be payable in one instalment.
The business is currently owned by BNB Resources which up until recently was quoted on Aim. Norman Broadbent is 26 years old.
Shares in Garner rose 0.125p to 3.125p each, which values the existing business at £1.19m.
Garner founder Andrew Garner will become executive chairman and Garner’s managing director Sue O’Brien will take on the same role for the enlarged group.
A £730,000 placing at 3p a share will pay the costs of the deal and some other liabilities.
Garner’s preference shares will be converted at the rate of eight ordinary shares and 1 Deferred B share for each preference share. This will remove £1.21m of liabilities from the balance sheet. That would nearly wipe out the total net liabilities of Garner at the end of June 2008.
Garner’s revenues fell 24% to £1.26m and profits fell from £313,000 to £29,000 in the six months to June 2008.
The three companies that make up the Norman Broadbent business generated revenues of £9.24m in 2007. The operating profit was £447,000.
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