TECHSTEP ANNOUNCES ACQUISITION OF BKE TELECOM AB, AND THEREBY CREATES A BROADER FOUNDATION FOR EXPANSION IN SWEDEN
Oslo, Norway, 3 July 2017, Techstep ASA (“Techstep” or the “Company”) entered into a binding agreement to acquire BKE Telecom AB (“BKE”) for an aggregated purchase price of SEK 81 million.
BKE, headquartered in Karlstad, Sweden, was founded in 1983 and is one of the leading providers of business telecommunication equipment and services, employing 43 full time equivalents. The product and services offering comprises hardware communication equipment, cloud PBXs, operator services and other services for the public sector and corporates in Sweden.
The hardware offering comprises, e.g. mobile, fixed, wireless and conference phones, headsets, tablets and other associated communication equipment, from, e.g. Apple, Dell, Jabra, HTC, Huawei, LG, Microsoft, Samsung and Sony.
BKE offers an industry leading cloud-based (UCaaS) PBX solution, where users may choose to communicate via mobile, fixed, wireless phones, web or computer applications. BKE is one of few market players in Sweden offering cloud-based PBXs integrated with all the largest Swedish operators, i.e. Tele2, Telenor, Telia and 3, and also Telavox.
BKE delivered revenues of SEK 166.6 million, SEK 239.6 million and SEK 189.1 million in 2014/2015, 2015/2016 and 2016/2017, respectively, and delivered adjusted EBITDA of SEK 14.1 million, SEK 18 million and SEK 15.5 million in 2014/2015, 2015/2016 and 2016/2017, respectively (BKEs fiscal year ends 30 April in respective years). In 2016/2017 hardware accounted for approximately 77 % of BKEs turnover. Total assets as at 30 April 2017 were SEK 50.1 million with an equity ratio of 32.1%.
The purchase price payable at closing of SEK 81 million will be settled with SEK 38.5 million in cash, SEK 15 million in seller credit and SEK 27.5 million in Techstep shares, to be issued at a price of NOK 5.70 per Techstep share (“BKE Consideration Shares”). The shares will be issued under Techstep’s current board authorization to issue shares approved at the extraordinary general meeting held on 28 February 2017.
In addition, it has been agreed that the sellers will have the right to an earn-out payment up to SEK 22.5 million based on certain criteria related to increased profitability.
Closing is subject to customary conditions, including certain third-party consents, and is expected end of August 2017. The transaction is not subject to any regulatory approvals. The sellers will have a lock-up on the BKE Consideration Shares with 1/3 until August 2018, 1/3 until February 2019 and 1/3 until August 2019. BKE is currently indirectly owned by Daniel Råd (33.3%), Peter Gustavsson (33.3%) and Thomas Gustavsson (33.4%).
Except for the sellers’ right to receive the BKE Consideration Shares, the transaction does not involve any specific rights to the benefit of the members of the Board of Directors or the executive managements of Techstep or BKE respectively, nor is any such agreements expected to be entered.
Strengthening offering in the Nordics and expanding customer base
Techstep has established itself as a Nordic enabler of the digital workplace and is experiencing a push from customers to be able to service them with mobile phones, laptops and tablets across the Nordics. The acquisition of BKE provides Techstep with a scalable setup to act as a cross border one-stop-shop.
Moreover, BKE offers a wide and solid customer base already asking for the enterprise mobility solutions which is the core of Techstep current offering. The combination makes a foundation for increased solution sales to BKEs current customers. In addition, the acquisition of BKE provide Techstep with a Swedish hardware, logistics and distribution platform which will be an integrated part of Techstep’s unique Mobile as a Service (MaaS) concept. MaaS allows Techstep’s customer to purchase the combination of hardware and solutions on a monthly payment OPEX-model.
BKE has a strong market position with their cloud PBX (switchboard and contact centre) solutions, which is well integrated with normal phone use and other communication technologies (such as Skype for business). Techstep is experiencing increased demand for pan-Nordic solutions in this area making the BKE offering an attractive alternative to solutions provided today.
BKE is one of the leading providers of communication equipment and telephony services in Sweden, with a significant growth potential to increase both the number of end-users and the degree of solutions delivered.
“With the acquisition of BKE we are expanding our customer base in the Nordics and strengthening our offering. We now have complete delivery capacity in Sweden, including hardware, mobile device management solutions, service and support, and BKEs leading cloud PBX solution. This will increase the scalability of our business model with our newly launched MaaS offering and create a truly pan-Nordic offering to many of our larger Nordic customers”, Gaute Engbakk, CEO of Techstep, says.
“We are very much looking forward to become part of the Techstep family. We have a solid customer base ready for the wider product offering from Techstep, and we have a logistics and support setup that can service Techstep’s Swedish customer base with a wider product range. Being part of Techstep we expect to be able to more effectively capitalize on our growth potential, in a strong and growing market”, Daniel Råd, the newly appointed CEO of BKE (and one of the current owners) comments.
For further information please contact:
Gaute Engbakk, CEO of Techstep: +47 91633281
Marius Drefvelin, CFO of Techstep: +47 95895690
Daniel Råd, CEO of BKE: +46 733-303132
Techstep ASA – we make the worklife mobile
Techstep is positioning itself as a leading Nordic enabler of the digital workplace. Techstep’s unique “Mobile as a Service” (MaaS) offering is a one-stop-shop solution, which combines hardware, subscription & connectivity, mobile device management, managed services and related software, in addition to financing. The MaaS solution enables enterprises to let employees do their work across mobile devices and locations, with a high degree of security and operational stability. Techstep employs approximately 160 team members based in Norway and Sweden, serving close to 5,000 customers and 450,000 end users across various industries in the private and public sector. The company had pro forma sales of approximately NOK 720 million in 2016 and is listed on Oslo stock exchange. For more information, please visit http://techstep.no/.
This information is subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act.