Flowtech Fluidpower PLC Acquisition of Orange County Ltd, County Durham (5215K)
10 July 2017 - 4:00PM
UK Regulatory
TIDMFLO
RNS Number : 5215K
Flowtech Fluidpower PLC
10 July 2017
NEWS RELEASE
Issued on behalf of Flowtech
Fluidpower PLC
Immediate Release (07.00hrs)
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
FLOWTECH FLUIDPOWER PLC
("Flowtech", the "Group" or "Company")
Acquisition of Orange County Limited
London: Monday, 10 July 2017: AIM listed specialist technical
fluid power products supplier Flowtech Fluidpower plc (LSE: symbol
FLO), is pleased to announce the further strengthening of its
Process division through acquisition of Orange County Limited
("OCL" or the "Acquisition").
ACQUISITION OF ORANGE COUNTY
On Friday, 7 July 2017, Flowtech completed the acquisition of
the business and assets of OCL, an exclusive UK supplier and
distributor of high-quality products for the storage and movement
of fuels, liquids and gases.
OCL was founded in 1994 and holds a market leading position in
the UK. The business employs in total 18 people at its site in
Spennymoor, County Durham. OCL will operate as an independent
sister company within the Flowtech Group and will continue to be
managed by the current executive management team who have been in
place for many years, reporting directly to Flowtech's CEO, Sean
Fennon.
The Acquisition provides a further complementary business to the
Group and establishes relationships with world-leading
manufacturers of pipes, valves, gauges and leak detection
equipment, including Brugg Pipesystems in Germany and Ebsray Pumps
in Australia. It is focused on technical sales, provided by
experienced sales engineers to a wide range of end users from fuel
supply systems for the automotive industry to cooling systems on
the London Underground, as well as large Data Centres across the
UK.
For the year ended 31 December 2016, OCL achieved sales of
GBP4.1 million producing EBIT of GBP1.0 million. Net assets
excluding net cash at the same date were GBP0.8 million. As well as
some immediate back office savings, the Group expects to deliver
synergy opportunities over the medium term by exploiting the OCL
offer across the Group's wider customer base, as well as enhancing
internal supply arrangements.
The Acquisition is being funded from Flowtech's own resources
and comprises GBP1.5m on completion with additional payments
expected to be cGBP2.1m subject to an earn-out over the 24-month
period to 30 June 2019. The maximum consideration payable is
GBP9.0m. In addition, the Group will pay a sum of GBP1.7m
equivalent to the net cash resources of OCL at the same date. With
adjustments to the salary base for the management team post
acquisition and current exchange rates reducing margins from
previous highs, the Board expects OCL to contribute annual EBIT of
cGBP0.6m in the short to medium term.
Sean Fennon, CEO Flowtech Fluidpower plc commented:
"OCL is the third acquisition we have made this year and we are
delighted to expand our knowledge base, add complementary technical
products and skilled engineers to the Group's already robust
customer offering. We take this opportunity to welcome all new
colleagues to the Group and see this momentum as an exciting
opportunity for everyone. We remain committed to our strategic
objective of building a focused Fluid Power Group that serves a
wide number of industry sectors."
Enquiries:
Flowtech Fluidpower plc
Sean Fennon, CEO
Bryce Brooks, CFO
Tel: +44 (0) 1695 52796
Email: info@flowtechfluidpower.com
Note: Flowtech Fluidpower plc has also released a pre-close
Trading update for the interim period ended 30 June 2017.
http://www.rns-pdf.londonstockexchange.com/rns/5215K_1-2017-7-9.pdf.
Zeus Capital Limited (Nominated Adviser and
Broker)
Andrew Jones, Jonathan Sharp (corporate finance)
Dominic King, John Goold (sales & broking)
Tel: +44 (0) 203 829 5000
finnCap Limited (Joint Broker)
Ed Frisby, Kate Bannatyne (corporate finance)
Rhys Williams, Emily Morris (sales & broking)
Tel: +44 (0) 20 7220 0500
TooleyStreet Communications (IR and media relations)
Fiona Tooley
Tel: +44 (0) 7785 703523 or email: fiona@tooleystreet.com
EDITORS' NOTES
About Flowtech Fluidpower plc:
AIM: symbol: FLO
Website: www.flowtechfluidpower.com
The business was founded as Flowtech in 1983,
and is the UK's leading specialist supplier
of technical fluid power products. The Flowtech
Group has three divisions: Flowtechnology,
Power Motion Control and Process. All three
of the Group's divisions have overlapping product
sets, allowing procurement synergies to be
maximised.
The Flowtechnology division focuses on supplying
distributors and resellers of industrial MRO
(maintenance, repair and operation) products,
primarily serving urgent orders rather than
bulk offerings. It is formed from Flowtechnology
UK, Flowtechnology Benelux and Indequip. It
offers an unrivalled range of Original Equipment
Manufacturer (OEM) and Exclusive Brand products
to over 3,400 distributors and resellers and
the catalogues are recognised as the definitive
source for fluid power products, containing
100,000 individual product lines and are distributed
to more than 80,000 industrial Maintenance,
Repair and Overhaul end users (MRO). The Power
Motion Control division specialises in the
design, assembly and supply of engineering
components and hydraulic systems and is further
enhanced by a service and repair function.
The division is formed from Primary Fluid Power,
Nelson Hydraulics, TSL Fluidpower and HTL.
The Process division focuses on the supply
of industrial components to the process sectors.
The Group's main distribution centre is in
Skelmersdale, Lancashire with further distribution
centres in the Netherlands and China. The Power
Motion Control division (PMC) has operations
in Merseyside, Northern Ireland, the Republic
of Ireland, Shropshire and Yorkshire; Process
operates from the West Midlands & County Durham.
In total, the business employs 318 people.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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