Mitie acquires high voltage electrical engineering company in £8.5m deal

Mitie has agreed to buy ESM Power, a high voltage electrical engineering company specialising in grid connections and energy, in a deal worth up to £8.5m.

The consideration comprises an initial payment of £5.5 million and performance-linked deferred payments of up to £3 million over two years.

Mitie shares rose 0.5 percent or 0.6 pence to 120.00 pence on Wednesday, having risen more than 20 percent over the past year.

Lincolnshire-based ESM Power has 20 years’ experience in the design, delivery and maintenance of high voltage electrical connections across a wide range of sectors including local authorities, commercial developments and power generation sites.

Mitie said the acquisition will enhance its expertise in the growing high voltage electricity connections market, “which continues to benefit from significant capital investment in energy networks as the UK achieves Net Zero.”

Following completion of the deal, ESM Power’s 60 high voltage engineering designers and installers will join Mitie’s £1.1bn Projects business, which delivers projects in building infrastructure, decarbonisation technologies, fire and security, and telecommunications infrastructure.

Mark Caskey, Managing Director of Mitie Projects, said: ‘This acquisition strengthens our position as a leading provider of electricity connections in the UK, offering our customers a broad range of design, delivery and maintenance capabilities to support their decarbonisation and asset resilience objectives.

“It is a continuation of the group’s strategy of investing in high-growth, high-margin companies that enhance our Projects business throughout the asset lifecycle. We look forward to working with our new colleagues.”

Roger Bamford, Managing Director of ESM Power, said: “We are excited to join the Mitie team, share our expertise and benefit from the opportunity to work with Mitie’s experienced colleagues and extensive customer base to grow our business.”

Last month, outsourcing firm Mitie raised its dividend following a 48% jump in annual pre-tax profits, helped by strong margins and the winning of new contracts including from government departments and e-commerce giant Amazon. The group increased its total annual dividend by 38% to 4p per share.

Mitie, which provides security, cleaning, engineering and other services to public and private sector clients, has embarked on a new three-year plan to boost margins through productivity and increased use of artificial intelligence analytics.

The plan is backed by a £19bn pipeline of opportunities, the group said.