Origin Enterprises acquires UK ecology consultancy Keystone

Irish agri-services group Origin Enterprises has acquired UK ecology consultancy and contractor Keystone Environmental.

The Dublin-listed company, which recently reported a 41 per cent increase in revenues in the year to the end of July due to soaring commodity prices, said the Gloucestershire-based company is a trusted ecological partner in its home market “with an established client base”.

Keystone, among other things, conducts pre-construction ecological studies and habitat surveys on behalf of clients applying for planning permission. It has counted the likes of Taylor Wimpey and former UK construction giant Carillion among its customers.

In a note on the acquisition, analysts at Davy Stockbrokers said the deal aligns with Origin’s allocation strategy to “build out its amenity platform with ecology services capabilities”.

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Origin, which supplies on-farm services, crop technologies and inputs, including fertilisers to farmers, has said its strategy “includes the recycling of surplus capital into value-accretive, sustainability-focused enterprises”, the analysts said. This would include ecology and landscaping.

“While modest in scale, Keystone offers Origin a low-risk route in establishing an ecology services platform,” the Davy analysts said. They said further bolt-ons are to be expected in due course.

Commenting on the announcement, Origin chief executive Sean Coyle said: “Keystone is an excellent fit for Origin to develop our ecology services for our existing customers as well as their strong client base. Investment in this sector is a key priority for the group, as we broaden our offering in sustainable land use. We are delighted to welcome the Keystone team to the Origin group and look forward to working together.”

In results published last week, Origin reported a surge in group revenues to €2.3 billion over the 12 months to the end of July, with operating profit up more than 96 per cent to €119.7 million. Margins rose to 5.1 per cent for the period, up from 3.7 per cent. Previous years were hit by the Covid-19 pandemic and extreme weather events.

Origin’s share price, which has bucked market trends in recent weeks, is up more than 7 per cent in the past 12 months. Shares in the company rose more than 2 per cent in early trading on Thursday following the announcement.