Johnson Services snaps up hotel linen firm Bourne in £22m deal
UNIFORM and dry cleaning company Johnson Services yesterday said it had snapped up Lincolnshire-based hotel linen company Bourne Services for £22m.
The deal will be funded with a new equity placing of £12.8m, the company said yesterday.
Executive chairman John Talbot said: “This is a significant step in our plan to expand the range of services offered by our textile rental business.”
Bourne supplies about 350 hotels and services around 28,000 bedrooms with linen.
The total amount paid by Johnson was £26.5m but this includes assets like Bourne’s freehold premises and £4.5m of cash on its balance sheet.
The deal was announced as the business unveiled a 25 per cent rise in annual profits to £13.4m for the year ended 31 December, from £10.7m a year earlier.
The company said this was due to the strong performance of its rental unit. However, overall revenues from continuing operations fell 2.6 per cent to £193.6m.
“The current year has started very positively and I am delighted with the acquisition of the Bourne linen business,” Talbot said.
“The new equity which part funds the acquisition maintains the strength and flexibility in our balance sheet which is important as we continue to look for further value enhancing acquisitions.”
Shares in the group rose 7.69 per cent over the day to close at 56p.
Investec, the company’s adviser, led the fundraising.