Wilmington announced the acquisition of SWAT Group Limited last week. The business provides training and technical compliance support to accountancy businesses in London and the South West. This will bolster the range of accountancy services offered by the Finance division and extend its geographic range in the UK. SWATs revenues are derived in broadly equal proportions from training and information & consultancy. An attractive purchase price (we estimate c5x EBIT) helps make a modest acquisition material at the EPS line, enhancing our FY17 by 2.3% and FY18 by 2.5%. FY17 EPS growth is now 11.7%. There is further substantial capacity to acquire and boost this growth further (by double digit %) and increase the potential exploitation of the secular global growth trend in compliance and regulation. Our Target Price rises to 339p and based on a 12 month TSR of 40.9% we reiterate our Buy rating.
