Listed transport tech firm Tracsis has acquired a London software company in a deal which could be worth £25.7m.

Leeds-based Tracsis, a provider of software and services for the rail, traffic data and wider transport industries, has acquired the entire issued share capital of London-based iBlocks.

Established in 2000, iBlocks specialises in the provision of smart ticketing solutions, automated delay repay and the development of mission critical back office systems that are used in the railway industry.

Tracsis said its directors believe iBlocks is “uniquely placed to help facilitate the move towards a paperless ticketing environment”.

In the year ended 28 February 2020, iBlocks generated revenue of £3m, profit before tax of £1.1m and had net assets of £3.5m. 

The acquisition consideration comprises an initial cash payment of £12.5m and the issue of 192,926 Tracsis shares with a value of £1.5m. 

An additional payment of £3.2m will be made on a pound for pound basis to reflect the net current asset position of the business at completion.

Additional contingent consideration of up to £8.5m is payable subject to iBlocks achieving certain

"We are delighted to have come together with iBlocks, a business we have known for a number of years now,” said Tracsis CEO Chris Barnes.

“We believe the unique technology offering that iBlocks has developed along with long established client relationships will open up an exciting new area of opportunity for Tracsis.

“The smart/account based ticketing market in particular is an area of the rail industry that will see significant future industry change and growth.

“We welcome the iBlocks management team and all staff to the Tracsis Group, and look forward to helping them achieve their growth aspirations as part of a larger organisation."

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Tim Brewer, director of iBlocks, commented: "This transaction marks the start of an exciting new chapter for the iBlocks business and our team.  Over the past 15 years, iBlocks has established a reputation in the rail industry as a provider of high-quality software products, which deliver unique, innovative and robust solutions for our customers especially within the smart ticketing and delay repay sectors of the industry. 

“Being part of a larger group will enable us to unlock opportunities that will benefit the UK rail industry and accelerate our growth."