Transaction adds scale and growth potential in key US markets and is
expected to add to RGP's revenue and EBITDA
Accretive's subsidiary Countsy will continue to operate under its own
IRVINE, Calif.--(BUSINESS WIRE)--
Resources Connection, Inc., (NASDAQ: RECN), a multinational business
consulting firm operating as Resources Global Professionals (‘RGP'),
today announced it has signed a definitive agreement to acquire
substantially all of the assets and assume certain liabilities of
Accretive Solutions, Inc. (‘Accretive') for $19.4 million
in cash and 1,150,000 shares of Resources Connection, Inc. restricted
Accretive is a professional services firm headquartered in Chicago with
eight offices across the United States and approximately 500
professional staff. The firm offers strong capabilities in accounting
and finance, enterprise governance, business technology and business
transformation, in addition to providing a back office suite of services
to startups through its Countsy brand. This acquisition provides RGP
with a number of key growth opportunities in the U.S., particularly in
the middle market and with startup companies.
Kate Duchene, President and CEO of RGP said, "The addition of
Accretive's talented team and extensive capabilities will greatly
strengthen our position in key US markets and allow us to add
subscription-based services to our offerings. Accretive's complementary
business model and service offerings will also help us achieve deeper
penetration with our existing clients and increase RGP's share in the
middle market - two of our key growth initiatives. We are also excited
about the growth opportunities provided by Countsy, which we hope to
expand into additional markets."
This transaction is expected to increase RGP's revenue by approximately
$65-70 million and EBITDA by $6.5-7.5 million after 9-12 months. The
upside to EBITDA will largely be driven by $4.5-5.5 million in cost
synergies that RGP expects to achieve by the end of calendar 2018,
resulting from office consolidations, the elimination of redundant
back-office functions and other specific cost reductions.
Accretive will transition into the RGP brand over the next 6-9 months,
with the exception of Countsy, which will continue to operate under its
own brand. Certain members of the Accretive senior leadership team,
including Accretive's CEO Kerry Barrett, will remain with the
organization and will support the transition and ongoing client service
and business development efforts. The transaction is projected to close
early in RGP's third fiscal quarter of 2018.
The Accretive transaction follows RGP's September 1, 2017 acquisition of taskforce
- Management on Demand AG, a German professional services firm that
provides clients with senior interim management and project management
Herb Mueller, CFO of RGP said, "Together, these two transactions support
RGP's strategic initiatives by adding scale in key markets, introducing
new capabilities and enhancing our ability to grow business with new and
existing clients. They are expected to drive RGP's topline performance
and create further value for our shareholders."
RGP, the operating subsidiary of Resources Connection, Inc. (NASDAQ:
RECN), is a multinational business consulting firm that helps leaders
execute internal initiatives. Partnering with business leaders, RGP
drives internal change across all parts of an enterprise - accounting;
finance; governance; risk and compliance management; corporate advisory;
strategic communications and restructuring; information management;
human capital; supply chain management; and legal and regulatory.
RGP was founded in 1996 within a Big Four accounting firm. Today, RGP is
a publicly traded company with over 3,200 professionals, annually
serving over 1,800 clients around the world from 69 practice offices.
Headquartered in Irvine, California, RGP has served 87 of the Fortune
The Company is listed on the NASDAQ Global Select Market, the exchange's
highest tier by listing standards. More information about RGP is
available at www.rgp.com.
Certain statements in this press release are "forward-looking
statements" within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. Such
forward-looking statements may be identified by words such as
"anticipates," "believes," "can," "continue," "could," "estimates,"
"expects," "intends," "may," "plans," "potential," "predicts," "remain,"
"should" or "will" or the negative of these terms or other comparable
terminology. Such statements and all phases of the Company's operations
are subject to known and unknown risks, uncertainties and other factors
that could cause our actual results, levels of activity, performance or
achievements and those of our industry to differ materially from those
expressed or implied by these forward-looking statements. Risks and
uncertainties that may or may not be realized include certain
anticipated benefits of the acquisition such as our ability to recognize
certain growth opportunities and achieve deeper penetration in the U.S.
middle market and with startup companies, our ability to greatly
strengthen our position in key US markets and add subscription-based
services to our offerings, our ability to exploit the Countsy brand to
expand into additional markets, our ability to achieve our revenue,
EBITDA and cost synergy expectations, as well as seasonality, overall
economic conditions and other factors and uncertainties as are
identified in our most recent Annual Report on Form 10-K and our other
public filings made with the Securities and Exchange Commission (File
No. 0-32113). Additional risks and uncertainties not presently known to
us or that we currently deem immaterial may also affect our business or
operating results. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
hereof. The Company does not intend, and undertakes no obligation, to
update the forward-looking statements in this press release to reflect
events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events, unless required by law to do so.
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Resources Connection, Inc.
Source: Resources Connection, Inc.
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