Volex PLC Acquisition of Servatron Inc (2132H)
30 Luglio 2019 - 12:42PM
UK Regulatory
TIDMVLX
RNS Number : 2132H
Volex PLC
30 July 2019
30 July 2019
Volex plc
("Volex" or the "Company")
Acquisition of Servatron
"Following through on Volex's strategy of building leading
positions in niche sectors with structural growth drivers"
Volex, the global supplier of complex assemblies for
performance-critical applications and power products, is pleased to
announce it has signed an agreement for the acquisition of all of
the issued stock shares and stock units of Servatron, Inc.
("Servatron") for a total consideration of up to $28.5 million,
including the assumption of net debt of approximately $6.7 million
(the "Acquisition"). We expect the transaction to close on 31 July
2019, subject to customary closing conditions.
Headquartered in Spokane, Washington, Servatron currently
supplies printed circuit board assemblies ("PCBA"), box builds and
complete sub-assembly solutions from a single manufacturing site in
the USA. For the year ended 31 December 2018, Servatron generated
sales of $35.6 million and profit before taxation of $2.5 million.
As a result of strong growth in the six months ended 31 June 2019,
it generated sales of $23.1 million and profit before taxation of
$2.0 million.
Background to the Acquisition
Servatron's business is a complementary fit with Volex's
strategy to maintain and build leading positions in niche sectors
with structural growth drivers and defensive characteristics.
Servatron adds complementary technologies including PCBA
manufacturing, state-of-the-art test capabilities and higher-level
system integration.
Anticipated Benefits from the Acquisition
-- By combining our cable-assemblies expertise and R&D
skills we will drive revenues for the newly enlarged Volex
-- Servatron adds complementary test technologies, higher levels
of system integration and PCBA assembly expertise
-- A strengthened footprint in North America
-- Increased organic growth through value-added services for our
existing cable harness customers
-- The incorporation into our business of a skilled local workforce and management team
-- The opportunity for further expansion of PCBA capabilities in other production locations
Consideration
The equity consideration of up to $21.8 million comprises:
-- $12.9 million in cash paid on completion of the Acquisition ("Completion")
-- $2.3 million satisfied by the issue of 2,233,712 million
ordinary shares in Volex (the "Consideration Shares") on
Completion
-- Up to $3.5 million in cash, which may be payable within two
years of Completion based on certain profit targets of Servatron
being met
-- Up to $3.1 million to be satisfied by the issue of 2,962,478
million ordinary shares in Volex within two years of Completion
based on certain profit and employment targets being met
The Consideration Shares are subject to a six-month lock-up.
Application has been made to the London Stock Exchange for the
admission of the Consideration Shares to trading on AIM
("Admission"). Admission is expected to take place at 8.00 am on 5
August 2019.
Following the issue of the Consideration Shares, the issued
share capital of the Company will comprise 149,601,645 ordinary
shares of 25 pence, each with one voting right. The above figure
may be used by shareholders in the Company as the denominator for
the calculations by which they will determine if they are required
to notify their interest in, or a change to their interest in, the
share capital of the Company.
Commenting on the acquisition, Nat Rothschild, Executive
Chairman of Volex, said:
"It is an extremely high-quality and well-managed business,
which will now be able to access our unique global footprint. Our
own world-class cable assemblies division gets a diverse range of
interconnect products and integrated solutions to offer our
existing accounts. This is a win-win deal."
The information contained within this announcement is deemed by
the Company to constitute inside information under Article 7 of the
Market Abuse Regulations (EU) No. 596/2014. The person responsible
for arranging the release of this information is Mr Daren Morris,
CFO of the Company.
Enquiries
For further information please contact:
Volex plc +44 7909 995 887
Nat Rothschild, Executive Chairman
Daren Morris, Chief Financial Officer and Company Secretary
N+1 Singer - Nominated Adviser & Joint Broker +44 20 7496
3000
Shaun Dobson
Whitman Howard - Joint Broker +44 20 7659 1234
Hugh Rich
Nick Lovering
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END
ACQDMGFNGGMGLZM
(END) Dow Jones Newswires
July 30, 2019 06:42 ET (10:42 GMT)
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