Marlowe plc

  Marlowe plc announces that it has entered into a binding agreement for the sale of certain Governance, Risk & Compliance software and services assets to Inflexion Private Equity, for an enterprise value of £430 million.   ·        Following the strategic review announced in November 2023, the Company announces the divestment of a select number of its GRC software and service assets for an Enterprise Value of £430 million, representing a multiple of 16.2x proforma adjusted cash EBITDA in the year ended 31 March 2023.   ·        The enterprise value of the Divestment, which accounts for approximately 20% of Group revenues and 40% of Group adjusted EBITDA, represents 123% of Marlowe’s market capitalisation as at 20 February 2024.    ·        The Group intends to use the proceeds of the Divestment to retire in full its current debt facility and return in excess of £150 million of surplus cash to shareholders.   ·        Alex Dacre will transfer with the Divestment and resign as Chief Executive of Marlowe on completion and Kevin Quinn will take up the position of Executive Chair on an interim basis. The Board has begun a search for a new Chief Executive, which will include both internal and external candidates. Commenting on the Divestment, Kevin Quinn, Marlowe’s Chairman said:   “This divestment represents an excellent outcome for Marlowe and its shareholders and underscores the significant value that has been created through the delivery of our growth strategy. The valuation achieved demonstrates the substantial potential within our business and will reset our capital structure, giving Marlowe strategic agility whilst delivering meaningful returns to our shareholders.   Following the sale, Marlowe’s business will consist of two market-leading compliance service divisions in Testing, Inspection and Certification and Occupational Health, with a clear and refocused strategy in our core compliance service markets.   Since 2015, Alex has been instrumental in developing Marlowe into a UK powerhouse in regulatory compliance which, through a combination of over 80 acquisitions and strong organic growth, has been transformed into a company with more than £500 million in revenues, over 5,000 colleagues and thousands of clients across the UK. On behalf of the Board, I would like to thank Alex for this exceptional achievement and his outstanding leadership in building Marlowe.”   Alex Dacre, Marlowe’s outgoing Chief Executive said:   “It has been a privilege to lead Marlowe since its inception and through the Group's rapid evolution into the UK’s leading provider of compliance. This divestment represents a significant premium to our market capitalisation and clarifies the Group's forward strategy to focus on the highly attractive and regulated compliance service markets. I wish everyone at Marlowe every future success.”

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Marlowe is holding a half year results presentation for investors and analysts at 09:30 BST today. A link to this event: https://lnkd.in/e-niHiMV “The Group delivered a good performance against a challenging macroeconomic backdrop in the first half of the year with organic growth of 6% demonstrating the resilience of our business and the markets we serve. We completed five acquisitions in the period including the strategic acquisition of IMSM which broadens our offering into the attractive ISO certification and audit space. Integration programmes are making good progress. The three major programmes within Occupational Health, Water & Air and Compliance eLearning, alongside multiple smaller integration programmes, are either complete or expected to conclude in the coming months. We expect these programmes to continue to deliver operational and financial synergies as they progress. We have made a good start to the second half of the year and expect to see mid-single digit organic growth supported by additional growth from acquisitions and continued double-digit growth in adjusted EBITDA” Alex Dacre, CEO, Marlowe PLC

Marlowe is holding a half year results presentation for investors and analysts at 09:30 BST today. A link to this event: https://lnkd.in/e-niHiMV “The Group delivered a good performance against a challenging macroeconomic backdrop in the first half of the year with organic growth of 6% demonstrating the resilience of our business and the markets we serve. We completed five acquisitions in the period including the strategic acquisition of IMSM which broadens our offering into the attractive ISO certification and audit space. Integration programmes are making good progress. The three major programmes within Occupational Health, Water & Air and Compliance eLearning, alongside multiple smaller integration programmes, are either complete or expected to conclude in the coming months. We expect these programmes to continue to deliver operational and financial synergies as they progress. We have made a good start to the second half of the year and expect to see mid-single digit organic growth supported by additional growth from acquisitions and continued double-digit growth in adjusted EBITDA” Alex Dacre, CEO, Marlowe PLC

Marlowe plc announces that the Group has acquired IMSM, a leading ISO certification and quality management provider. Established in 2004 and headquartered in Wiltshire, UK, IMSM provides ISO auditing and certification services to approximately 5,000 UK and international clients. This acquisition is a key step in Marlowe’s strategy to broaden its GRC capabilities into the highly complementary ISO certification market and presents an attractive opportunity to cross-sell into the Group’s existing customer base. Additionally, there are opportunities to digitalise IMSM’s services via collaboration with Marlowe’s SaaS offering. IMSM audits the quality of clients’ business processes and internal systems on a recurring basis to ensure compliance with ISO standards in areas such as safety management, information security and environmental management. IMSM provides these services to both SMEs and larger clients on a mix of annual and multi-year contracts, and shares a similar client base to Marlowe’s GRC division. In the year to 31 December 2022, IMSM generated revenues of £12.2 million. Alex Dacre, Chief Executive of Marlowe plc said: “The acquisition of IMSM broadens the capabilities of our Governance Risk and Compliance division into the attractive and highly complementary ISO auditing and certification market. This is a large and fragmented market, and the addition of IMSM will enable us to address a core component of our clients’ compliance requirements.” https://www.imsm.com/gb/