Dewhurst PLC Acquisition and Director Appointment (1792Q)
04 June 2018 - 7:11PM
UK Regulatory
TIDMDWHT
RNS Number : 1792Q
Dewhurst PLC
04 June 2018
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Dewhurst plc
("Dewhurst" or the "Company")
Acquisition of A&A Electrical Distributors Ltd and Director
Appointment
Dewhurst plc, an independent supplier of quality components to
the lift, keypad and transport industries is pleased to announce it
has entered into an agreement to acquire the entire issued share
capital of A&A Electrical Distributors Limited ("A&A") for
an initial consideration of GBP10.5 million plus a deferred
consideration based on profits generated over the next two years
(the "Acquisition"). The Acquisition will be funded from existing
cash resources.
The Board expects the Acquisition will be immediately earnings
enhancing.
Summary of A&A's business
A&A, based in North East London, is a lift and electrical
distribution company which works with major and independent lift
companies operating in the UK. A&A recently acquired the trade,
non-current tangible assets and inventory including work in
progress of A. & A. Electrical Distributors Limited (the
"Business"), which was founded by Alan and Ann Warren thirty five
years ago. Alan and Ann Warren have grown the Business to be a
leading supplier of lift components across the UK and have been a
long-standing customer of Dewhurst. Whilst Alan and Ann Warren will
retire from the day-to-day running of the Business following the
Acquisition, they will both remain for a short period to ensure a
smooth transition.
Prior to acquiring the trade and certain assets of the Business,
A&A was a shell company named A&A Woodford Limited with no
assets or liabilities.
Summary of the Acquisition terms
The Company will acquire the entire issued share capital of
A&A for initial cash consideration of GBP10.5 million plus or
minus a cash adjustment for normalised working capital expected to
be no more than GBP250k. In addition, deferred consideration of 25%
of the adjusted pre-tax profit generated over the 24 months
following the acquisition date which, based on historic profit
generated, management anticipate this will result in further
consideration payable of approximately GBP1.5 million.
For the year ended 30 June 2016, A&A generated (audited)
profit before tax of GBP3.3 million on turnover of GBP11.4 million.
The reported profit excludes the employment costs of Alan and Ann
Warren. The acquired net assets in A&A are expected to be in
the region of GBP0.8 million.
Board appointment
On completion of the Acquisition, Alan Warren will join the
Dewhurst Group Board as a non-executive director on a remuneration
of GBP20k per annum for an initial period of two years effective 13
June 2018.
Richard Dewhurst, the Chairman of Dewhurst, said:
"A&A is a significant acquisition for Dewhurst and it is
important that we are able to replace Alan and Ann with a strong
Dewhurst senior team. We are pleased to announce that John Bailey
with his wealth of experience within the Group is rejoining us in
an executive role as Managing Director of A&A and will remain
on the Group Board. We are also delighted that Jeremy Dewhurst is
joining the Group as A&A's Finance Director. Jeremy is a
qualified Chartered Accountant who was previously a Senior Manager
with the Equity Capital Markets team at Deloitte in London."
Commenting upon the Acquisition, John Bailey, the new Managing
Director of A&A, said:
"As one of the UK's leading independent distributors of lift and
electrical components, this Acquisition provides an exciting
opportunity for A&A and the Dewhurst group to expand our
services to the lift industry both in the UK and other overseas
markets. The Acquisition is in line with Dewhurst's strategy of
providing a broad range of high quality products and services to
the lift industry and will be immediately earnings enhancing."
-Ends-
For further details please contact:
Dewhurst Plc Tel: +44 (0) 208 744 8200
Richard Dewhurst, Chairman
Jared Sinclair, Finance Director
www.dewhurst.plc.uk
Cantor Fitzgerald Europe Tel: +44 (0) 207 894 7000
David Foreman / Will Goode (Corporate Finance)
Alex Pollen (Sales)
Additional Information in respect of the AIM Rules
The following information regarding the appointment of Alan
Michael Warren, aged 60, is disclosed under Schedule 2(g) of the
AIM Rules for Companies:
Current Directorships Previous Directorships
(within the last five
years)
-------------------------------- ----------------------------
A. & A. 2000 Ltd Universal Lift Products
Ltd
-------------------------------- ----------------------------
A. & A. Electrical Distributors A. & A. Electrical Trustees
Ltd Ltd
-------------------------------- ----------------------------
Lift and Escalator Industry
Association
-------------------------------- ----------------------------
Foxed Lane (Cuffley) Management
Company Ltd
-------------------------------- ----------------------------
A & A Woodford Ltd
-------------------------------- ----------------------------
As at the date of this announcement, Mr. Warren and persons
closely associated with him, is beneficially interested in 7,936
ordinary shares of Dewhurst and 9,090 'A' shares of Dewhurst.
There are no further disclosures required under Schedule 2(g) of
the AIM Rules for Companies.
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END
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