UK-based Serviced Office Group (SOG) is set to acquire Avanta Managed Offices in a £15 million deal.
Competition is certainly increasing in the flexible workspace sector, if the rate of mergers and acquisitions is anything to go by. In fact, this churn has been heating up for some time now, as demand for flexible workspace rises and alternative operators like hotels and storage suppliers begin to muscle into the sector.
Back in December we reported on Regus’ acquisition of Regent and Corporate Office Centers, followed smartly by MWB Business Exchange’s transition into the Regus camp earlier this year. At the BCA Conference in May, Regus UK CEO John Spencer told us that we should expect more consolidation between industry operators. And he was right.
Now there’s another high-profile acquisition on the cards, and it’s set to complete by the end of this month. Serviced Office Group (SOG), an AIM-listed supplier of high quality flexible workspace in London, has made a move for Avanta Managed Offices in a £15 million acquisition plan.
The reason? With demand and revenue opportunities in London on the rise, SOG want to expand their Central London portfolio – and they see a merger with Avanta as the best way to do it. It’s a smart move. Avanta operates 17 first-rate business centres across the city and is already one of the UK’s leading suppliers of serviced and managed office space. In Avanta, SOG have a successful brand, an established client base and some of the most sought-after flexible office locations in London.
What’s more, the acquisition will bring SOG’s portfolio close to the 40 mark, making them one of the largest serviced office providers in the UK by workstations. Yes, they’re still a fair way behind Regus. But that will make them a force to be reckoned with in London – and that’s the gold mine. Plus, Avanta have an established meeting room business that will make an enviable addition to the SOG conferencing portfolio.
The official word from Avanta is printed below. This is big news for the industry and especially so for SOG’s competitors. We’re also wondering, will 2013 see yet more collaboration? What ‘supergroup’ will spring up next? We await further developments with interest.
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Avanta to be Acquired by Serviced Office Group PLC
The shareholders of Avanta Managed Offices Limited (Avanta), a leading provider of flexible workspace for growing businesses, have entered into a conditional agreement for Avanta to be acquired by Serviced Office Group plc (SOG) for £15.0 million (Transaction). The Transaction is expected to complete on 29 July 2013.
Avanta’s current property portfolio, offering and service levels are expected to stay as they are now with Avanta operating as part of the wider group, combining Avanta’s 17 business centres with SOG’s 20. It is intended that, following completion of the Transaction, Avanta’s CEO, Alan Pepper, will become Chief Operating Officer of SOG, running the serviced office operation for the enlarged group. The Avanta management team will also take up positions at SOG.
Commenting on the announcement, Alan Pepper, CEO Avanta, said: “This is a good deal for Avanta, its customers and employees. SOG and Avanta are an excellent fit, with a similar service ethos and a complementary office portfolio. Avanta customers will continue to receive flexible workspace in central London locations with market-leading levels of customer service and support, from the same award-winning team as they do now. With Avanta’s portfolio of office space, SOG will become one of the largest serviced office group providers in the UK by number of workstations.”
A further announcement will be made following the completion of the Transaction.
About Avanta Managed Offices
Avanta Managed Offices Limited was formed in 2004. The company offers high quality and cost effective serviced offices, meeting rooms and virtual offices in prime locations throughout London and the UK. All its business centres are managed by highly trained, Institute of Customer Service accredited teams, an industry first. Avanta operates 660,000 sq ft of office space across 19 buildings in the UK, and two in New Delhi, India.