TIDMBYOT
RNS Number : 7024Y
Byotrol PLC
23 August 2018
23 August 2018
Byotrol plc
("Byotrol" or the "Company")
Acquisition of UK infection control company Medimark Scientific
Limited
Byotrol plc, the AIM listed anti-microbial hygiene company, is
pleased to announce the acquisition of Medimark Scientific Limited
("Medimark") a leading provider of biocide-based infection control
products into the animal and human healthcare markets (the
"Acquisition").
Medimark is a profitable and growing business which has a broad
sales, marketing and distribution expertise. Medimark sells
infection control products used on surfaces, instruments and hands
for the Animal Health, Human Health, Laboratory, Environment and
Retail markets. The company is based in Sevenoaks, Kent, has 14
employees and is ISO9001 quality registered with supporting
registration under the Medical Device Directive. In the year ended
31 March 2018, Medimark reported adjusted EBITDA of GBP380k on
revenues of GBP2.7m.
There is an existing and long-standing relationship already in
place between the two companies - Byotrol is currently a white
label supplier of hand sanitisers to Medimark, which it sells under
its Esense brand.
Consideration of up to GBP4.5m is payable in respect of the
Acquisition, which includes GBP0.4m of debt that Byotrol is
assuming.. Initial consideration of GBP2.3m is payable on
completion, being GBP1.15m in cash and GBP1.15m from 28,048,780 new
ordinary shares ("Ordinary Shares") being issued at 4.1p per share.
An additional GBP1.8m of consideration is payable subject to
achieving EBITDA targets in FYE 31 March 2019 and FYE March 2020.
The deferred consideration is also to be paid half in cash and half
in new ordinary shares.
Highlights:
-- Immediately provides Byotrol with greater scale than could be
achieved through current rates of organic growth. Medimark is
profitable and cash generative and fits extremely well with
Byotrol's existing products and technology.
-- Expected to be materially earnings enhancing in first year
from acquisition. The combination of the two businesses will
greatly accelerate Byotrol's growth profile whilst significantly
reducing the execution risk from purely organic expansion.
-- Highly complementary acquisition, offering extensive sales,
marketing and distribution expertise in Byotrol's core markets.
Specific complementarity with Byotrol's Professional and Petcare
businesses with significant synergies expected over time,
including:
-- Enhanced distribution of Byotrol technologies to Medimark
customers, in the UK and overseas, boosting economies of scale,
distribution and market segment expertise
-- Highly experienced, well-connected and resilient sales team and sales support
-- Introduction of stronger disinfectant technologies to Byotrol
portfolio including a proprietary sporicidal formulation
-- Doubles Byotrol workforce, creating immediate critical mass
with cost synergies available from bringing Medimark technical work
in house.
-- Medimark is on track to deliver EBITDA of GBP500k for the
full year to March 2019, which will trigger the first earn-out
payment
-- Executive management staying with the combined business for
the earnout and beyond, with incentives closely aligned with
Byotrol shareholders. Executive management locked-in from share
sales for three years from completion.
-- Completion expected on admission of the consideration shares
which is expected to be 30 August 2018.
Following the Acquisition, it is expected that Byotrol will have
cash balances in excess of GBP2.5m, providing more than sufficient
resource to drive growth of the combined businesses.
Commenting on the acquisition, John Langlands, Byotrol Chairman,
said:
We are delighted to have concluded the acquisition of Medimark
and we welcome its directors, employees, customers and stakeholders
to Byotrol.
The fit between the two companies is remarkably strong with
Medimark's excellent sales and marketing capabilities dovetailing
very well with our technical expertise. We also see more
opportunities to take the combined group's infection control
products into consumer markets.
Our enlarged operations will now be offering cutting-edge
infection control products to more customers in our
jointly-targeted markets with improved propositions. We have a
strong balance sheet and are confident that the combination of the
two companies will bring Byotrol to critical mass with the
resources to deliver sustained growth and profitability.
Rick Hayman, the MD and major shareholder of Medimark,
added:
Joining forces with Byotrol is a very exciting step forward for
the Medimark team, enabling us to take our business to a new level.
With their technical expertise and commercial and sales experience
skills, we see the two companies as an excellent fit. We very much
look forward to pursuing the market opportunities together with the
Byotrol team.
For the purposes of Article 7 of EU Regulation 596/2014, this
announcement contains inside information.
For further information, please contact:
Enquiries:
David Traynor - Chief Executive, Byotrol plc 01925 742 000
David Paton - Investor Relations 07714 190 474
finnCap Ltd 020 7220 0500 (Nominated Adviser & Broker)
Geoff Nash/Kate Bannatyne- Corporate Finance
Tim Redfern/Richard Chambers - Corporate Broking
Notes to Editors:
Byotrol plc (BYOT.L), quoted on AIM, is a specialist developer
of antimicrobial technologies, identifying, developing, formulating
and commercialising cutting-edge antimicrobial solutions.
Our patented suite of technologies deliver powerful,
broad-spectrum efficacy, optimised against commonly-occurring and
industry-specific pathogens.
Founded in 2005, the Company seeks to develop and commercialise
advanced antimicrobial technologies that create easier, safer and
cleaner lives for everyone.
For more information, please go to www.byotrol.co.uk
Terms of the Acquisition
The consideration for the entire issued share capital of
Medimark is up to GBP4.1m, with debt of GBP400k being assumed. The
consideration is payable as follows:
-- At completion, initial consideration of GBP1.15m in cash from
Byotrol's internal resources and GBP1.15m from 28,048,780 new
Byotrol shares issued at 4.1p per share
-- Two-year earnout of up to GBP1.8m subject to achieving EBITDA
targets based on significant growth from that achieved in FY2018.
The deferred consideration is to be paid half in cash and half in
new Ordinary Shares with the shares issued at the 15 day average
price ahead of issue.
The initial consideration shares represent 6.5% of the enlarged
share capital of Byotrol plc.
Application for Admission:
Application has been made for 28,048,780 Ordinary Shares to be
admitted to trading on AIM ("Admission"). Admission is expected to
become effective on 30 August 2018. Following Admission, Byotrol
will have 430,885,271 Ordinary Shares. All Ordinary Shares shall
have equal voting rights and none of the Ordinary Shares are held
in treasury. The total number of voting rights in the Company
immediately following Admission will therefore be 430,885,271.
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END
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August 23, 2018 06:31 ET (10:31 GMT)
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