Mouchel Parkman in £46m takeover of HBS

AUG 2007

Mouchel Parkman, the engineering consultancy and support services group, boosted its business outsourcing operations with a £46 million acquisition yesterday.

Mouchel Parkman, the engineering consultancy and support services group, boosted its business

outsourcing operations with a £46 million acquisition yesterday.

It announced the cash takeover of HBS, formerly Hyder Business Services, from Terra Firma.

Mouchel Parkman shares gained 13 per cent in early trading after the City digested the prospects of

the acquisition turning the enlarged business into the number one supplier of outsourced professional

services to local authorities.

The deal is expected to strengthen its existing core market, build economies of scale and provide strong organic growth, it said.

Milton Keynes-based HBS's operations are in business process outsourcing (BPO) and IT. Mouchel

Parkman said the acquisition would provide a platform for the group to exploit the UK BPO market

which is worth some £4 billion a year and which is expected to grow by ten per cent a year.

It combined the announcement with an upbeat pre-close period assessment of current trade with a

forward order book at an all-time high of £2.2 billion compared with £1.2 billion at the same stage last year.

ABN Amro upgraded Mouchel Park-man's shares to "buy" from "add", while Seymour Pierce said it was reviewing its price target for the stock in the light of the potential for diversified earnings growth.

Cazenove analyst Michael Morris said the acquisition represented good value, even though HBS is

currently making a loss.