Based in Liverpool, stock-market listed SysGroup provides IT and cloud services and has acquired a Bristol IT business in a £1m deal – its second acquisition this month. Tony McDonough reports

IT and cloud services business SysGroup has completed its second acquisition this month. 

Liverpool-based SysGroup, which is listed on the Alternative Investment Market (AIM), has acquired Bristol-based IT services firm Orchard Computers for £1m. It follows on from the acquisition of Edinburgh-based Truststream Security Solutions in an £8m deal.

Orchard has been in operation for more than 30 years and has built a loyal customer base totalling over 120 active clients in 2021, largely in the South West of England. The average length of relationship among its 20 largest clients is 12 years, with no single customer representing more than 7% of total revenues.

It represents customers across a range of sectors, covering both the private and public sectors. Its managed IT service offering mirrors that of SysGroup, providing consulting services, building IT systems and providing ongoing support.

SysGroup believes that Orchard will further strengthen its presence in the South West of England with the addition of more than 20 team members joining the wider SysGroup team.

In the year ended December 31, 2021, Orchard generated revenues of £2.1m, EBITDA of £300,000 and profits before tax of £300,000. Recurring revenues in 2021 accounted for 56% of total income. Its net assets at December 31 were £300,000.

SysGroup has bought Orchard from Ian Terry and Chris Patten. Both will remain with SysGroup for a minimum period of three months to assist with the handover of customer relationships and integration into the group.

Adam Binks, chief executive of SysGroup, said: “I am thrilled to be announcing our second acquisition of the financial year. Orchard is a well-established, well-respected business with a loyal customer base in the South West of England and I am delighted that we have been able to bring this business into the group.”

Earlier this month SysGroup, which is based in Exchange Flags in Liverpool city centre, says it expects full-year revenues to decline for the second year in a row with customers deferring major IT projects due to the pandemic.