Town Centre Securities (TOWN), the property investment, development, car park and hotel operator, has sold its equity investment in YourParkingSpace (YPS) Limited to Flowbird SAS for £20.7m – a huge uplift on the book value of the stake of £1.47m (with an additional £1.53m loan to YPS) on the group’s balance sheet.
The YPS platform connects drivers with over 350,000 privately owned and commercially operated parking spaces across the UK, available to book hourly, daily or monthly via the company’s website or mobile app.
The consideration for the sale comprises the following:
- Initial net cash consideration for the company’s equity shareholding of £9.6m
- Deferred consideration of £7.5m, due in two instalments: £4.4m 12 months after completion of the sale, and £3.1m after 24 months
- A final cash consideration, based on the trading performance of YPS in the 14 month period following completion of the sale, of up to £3.6m
In addition, the company will receive repayment in full (including all accrued interest) of the amounts loaned to YPS, comprising £1.95m.
The sale will be accretive to both NTA and earnings for the group, and the group said that the proceeds will be used to further reduce net borrowings and redeployed into other accretive opportunities in due course.
Background to the YourParkingSpace investment
TOWN’s initial equity interest in YPS was acquired on 16 November 2016, through the acquisition of 9.375% of the issued share capital from the two founders of the business. This investment of £0.415m was funded from the company’s cash resources. The company then acquired further shares in YPS from the founders over the course of the following years – ultimately taking the cost of investment in YPS from £0.415m to £0.965m.
Ben Ziff, chairman and chief executive of TOWN, commented: “Since making our initial investment in YourParkingSpace in November 2016, the business has gone from strength to strength and has now evolved into much more than just an online broker for reselling space. It has become a true disruptor in the parking sector.
“The consideration from this sale helps to further strengthen the TOWN balance sheet whilst giving it the opportunity to invest in our development pipeline and make strategic technology investments.”
TOWN : Town Centre Securities sells stake in parking app at huge uplift