Listed Birmingham-based firm Wilmington has acquired Spanish RegTech Conversia in a £105m deal as it looks to step into the data privacy compliance market.
The governance, risk and compliance (GRC) data and training specialist is buying the Barcelona-based business from investment firm Arraigo, with completion subject to foreign direct investment clearance in Spain expected within 8 to 12 weeks.
Conversia provides proprietary software solutions that help small and medium-sized businesses in Spain navigate complex data privacy laws.
With a target market of around 3.2m SMEs and homeowner associations, the company has delivered €36.6m in revenue and €9.3m in EBITDA in the last year.
It has consistently achieved double-digit growth and operates a subscription-led model, with over 70% of its revenue recurring annually.
Wilmington will fund the acquisition using a combination of £35m in existing cash and £70m from new debt facilities.
This will temporarily double its debt compared to earnings, but the company expects to reduce that within a year.
The firm said the deal is expected to enhance earnings from year one and aligns with its strategy to grow in GRC markets through a mix of organic expansion and targeted acquisitions.
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Its share price has spiked since the news, currently sitting at 358p compared to the 334p it was at when trading stopped yesterday.
The company has a market cap of £320m and has seen shares consistently rise since 2020, with its stocks now closing in on the 445p peak it reached in March 2000.
“This earnings enhancing acquisition will extend our reach in the GRC markets and opens up a new horizontal for us in the regulated data privacy sector,” said Mark Milner, CEO of Wilmington. “We plan to expand our products and services into this sector.
“Conversia is the industry leader in a rapidly growing market in Spain for the provision of software and RegTech solutions, helping small and medium-sized enterprises meet legally regulated data privacy compliance requirements.
“It operates in a large addressable target market, delivering high quality revenues of which greater than 70 per cent. are annually recurring, and is led by an impressive, successful and committed management team.
“This acquisition will add significant value across all our stakeholders. We look forward to welcoming Alfonso and his team to Wilmington.”
Alfonso Corral, director general of Conversia, added: “Joining Wilmington represents an extraordinary opportunity to accelerate our growth and consolidate our leadership in the regulatory compliance market for SMEs.
“We share with Wilmington a forward-looking vision based on technological innovation, operational excellence, and a strong commitment to our clients.
“Our team has consistently shown its ability to transform a complex regulatory environment into an opportunity to deliver value and build trust through our solutions. We will continue to work with the same dedication and ambition – now with the support of a global group like Wilmington – to expand our reach, diversify our offering, and strengthen our relationship with our clients.
“I would like to thank Mark for his trust in our team and in the value we have built over the years. His strategic vision and clear commitment to the GRC sector have been instrumental in making this integration both solid and forward-thinking.
“I embrace this new chapter with excitement, responsibility, and full confidence in all that lies ahead.”