Tribal Group - Instant Library

Tribal Group, the public sector outsourcing company, announces the acquisition of Instant Library, the leading UK outsourced managed library services company. This acquisition provides Tribal with a strategic position in this £1.3bn market. The equity financing was led by Gresham Trust.

Tribal today announces the acquisition of Instant Library, the UK's leading provider of outsourced library management services. Gresham Trust is underwriting this deal. Mike Henebery of Gresham Trust will become a non executive director of Tribal Group.

Tribal`s business strategy is to develop a group of specialist businesses that provide services to the local government and education sectors. This is being achieved through an aggressive acquisition strategy. The Group is looking to spend up to a further £20 million on acquisitions, acquiring high growth companies, incentivising management through share ownership.

Instant Library offers a diverse range of specialist information management services including; the provision of outsourced libraries and all activities involved with the operation of library services, library design and set up, the procurement of books and journals, cataloguing and classification, and information brokerage.

The company also provides specialist services in record and data management, operating on site teams of staff who store and retrieve company documentation and also provide scanning and digitisation to move paper into an electronic version.

Instant Library has extended its portfolio to include the development of virtual library services for clients who have no on-site facilities but need rapid access to information.

Tribal intends to expand Instant Library's business in the local authority, education and health sectors. Public sector library provision is a £1.3bn industry and Tribal hopes to strike strategic alliances with local authorities to pioneer improved library provision.

Instant Library will expand its business to assist local authorities with Best Value reviews of their library provision, records management and file tracking services.

Instant Library's clients include a number of blue chip companies including: London Underground Limited, BG International and various NHS Trusts and Public sector bodies.

In major cities there are libraries in further education colleges, universities and schools as well as the public libraries. In Westminster for example, in eight square miles there are over 50 libraries. There is a good opportunity for developing a new approach that would reduce cost yet improve choice and public access.

Tribal expects to announce further acquisitions in August. The company is expected to list on the AIM market in early 2001. Sponsors will be announced in the autumn.

Approximately £1.3bn of public expenditure is spent in the libraries sector, of which 60% is directed towards public libraries. There are over 3,500 libraries ranging from central reference libraries to small branches and mobile libraries. The remaining funds go to academic libraries (around 700), the health sector and government libraries. This funding does not account for the commercial libraries and private collections. Overall there are 128m books in circulation in public libraries.

Henry Pitman, chief executive of Tribal, commented: "This is the next exciting step in Tribal's development. Over the next few months we will announce further acquisitions which will position us strategically for our IPO"

"We are going to develop Instant Library's business in the education, local authority and health sectors. There are great opportunities to work in strategic partnerships with the public sector, to pioneer new and improved library provision."

Our on-line library capability will allow us to increase public access, particularly in rural areas."

Mike Henebery of Gresham Trust commented: "Fast growth in the local government and education outsourcing market is certain now that the government has made education its key priority. The outsourced education market is now worth £1.5bn a year and the overall outsourcing market is put at £10bn a year."

"Tribal Group is seizing an excellent commercial opportunity to grow in this relatively immature market. Gresham supports Tribal's strategy of development by acquisition."