InvoCare (ASX:IVC) share price on watch after acquisition announcement

The InvoCare Limited (ASX:IVC) share price will be on watch on Thursday following the release of an after-market acquisition announcement…
The post InvoCare (ASX:IVC) share price on watch after acquisition announcement appeared first on Motley Fool Australia. –

2 businessmen shaking hands

The InvoCare Limited (ASX: IVC) share price will be on watch on Thursday following the release of an announcement after the market close.

What did InvoCare announce?

This afternoon the funerals company announced that it has entered into conditional sales agreements to acquire 100% of the shares of Family Pet Care and the business and assets of Pets in Peace.

InvoCare has agreed a combined price of $49.8 million, of which $11.5 million represents deferred consideration subject to the attainment of 2-year earnings targets.

Management notes that the two acquisitions will provide InvoCare a national footprint and position it as the market leader in pet cremation and pet after life services in Australia.

They also represent a strategic expansion of the company’s existing pet cremation business in NSW (Patch and Purr), putting it in a position to capture a larger slice of an industry estimated to be growing at ~9% per annum.

The acquisitions are forecast to deliver combined annual revenue of ~$19.3 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of $5.2 million. Management also expects the acquisitions to be earnings per share accretive in the first full year of operations.

“High-quality businesses.”

InvoCare’s Chief Executive Officer, Martin Earp, appeared to be very pleased to be able to acquire these high-quality businesses.

He said: “The acquisitions are a significant expansion into the adjacent market of pet cremations building on our 2018 entry into this market in NSW and transforming the Pet Cremation division of InvoCare into a meaningful contributor to overall earnings. We are excited to complete these transactions as they are both very high-quality businesses providing exceptional levels of customer service.”

Mr Earp sees the expansion of this side of the business as a natural evolution for the funerals company.

The chief executive commented: “Expanding the pet cremation business is a natural evolution for InvoCare providing opportunities to leverage its decades of operating in the end of life market. In addition, it is our belief that our deep experience in memorialisation in our core business will transfer across to the pet sector given the increasing trend towards the humanisation of the pet industry.”

“I am also delighted to announce that the current owners and leadership teams of both businesses will remain in place to ensure that we continue to provide the highest level of customer service and facilitate a smooth integration with InvoCare’s existing pet cremation operation, Patch & Purr. This will include building on the market leading service proposition provided through Patch & Purr’s technology and bespoke cremations,” he concluded.

Man who said buy Kogan shares at $3.63 says buy these 3 ASX stocks now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended InvoCare Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post InvoCare (ASX:IVC) share price on watch after acquisition announcement appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!