Companies: VTS   

Acquisitive accountancy group Vantis has pulled off a stunning deal by acquiring rival AIM-quoted concern Numerica for £15.8m and immediately selling on three practices in Bristol, Southampton and Manchester to BDO Stoy Hayward for £12.1m cash. Numerica last year reported a turnover of £46.6m. The three businesses to be bought by BDO produced £16m revenues. This means Vantis is left with the residue, making turnover of £30m, for a net cost of £3.7m. Tightly run Vantis, recommended here a year ago at 111p, should also be able to cut out costs. For example all except one of Numerica's full board directors will go. The group will also have opportunities to provide additional services, such as tax advice, to Numerica's client base and so boost income. Numerica made a £1m profit before tax, goodwill and exceptional items in the six months to November. Vantis' interims to October showed a 52% rise in pre-tax profit to £1.95m on sales up 48% to £15.1m. This bodes well going forward. Prior to the deal house broker Charles Stanley was predicting pre-tax profits of £7.5 million for the full year, equating to 12.6p of earnings per share. The deal offers Numerica shareholders either 16 new Vantis shares for every 73 they own or else 30p a share in cash. If the split is 50-50 then this should enhance earnings significantly next year. Buy.