Flowtech Fluidpower PLC FLOWTECH EXPANDS ITS FOOTPRINT IN EUROPE (1529Q)
08 September 2017 - 12:38AM
UK Regulatory
TIDMFLO
RNS Number : 1529Q
Flowtech Fluidpower PLC
07 September 2017
NEWS RELEASE
Issued on behalf of Flowtech Fluidpower PLC
Immediate Release
FLOWTECH FLUIDPOWER PLC
("Flowtech," the "Group" or "Company")
Flowtech expands its footprint in Europe through the
Acquisition of The Hydraulic Group B.V. Benelux
London: Thursday, 7 September 2017: AiM listed specialist
technical fluid power products supplier Flowtech Fluidpower
plc (LSE: AiM: symbol: FLO) is pleased to announce
the further strengthening of its Power Motion Control
(PMC) division through the acquisition of The Hydraulic
Group B.V., including its main trading operation,
Hydroflex Hydraulics ("Hydroflex"), a distributor
of hydraulic equipment and components, predominantly
to the mechanical engineering, marine and agricultural
sectors. The business is headquartered in Rotterdam,
and has a sales presence in Brussels; it also complements
the Group's existing Flowtechnology operation in the
Netherlands.
Hydroflex was founded 50 years ago and holds several
long-term customer relationships through its operations
in the Netherlands and Belgium. The business employs
42 people in total. The acquisition provides another
complementary business to the Group's PMC division,
delivering incremental revenue through a wider geographical
channel and extends Flowtech's position with important
European suppliers, and in particular, Eaton Corporation.
Hydroflex will operate as an independent sister company
within the PMC division and will continue to be managed
by the previous owner and Managing Director, Leo Voogd,
who has been with the business for over 20 years.
For the year ended 31 December 2016, Hydroflex achieved
sales of GBP6.7 million producing EBIT of GBP0.4 million.
Net assets excluding net debt at the same date were
GBP1.1 million. The Group expects to deliver synergy
opportunities over the short and medium term through
coordinated procurement and back office activities,
as well as wider commercial opportunities through
collaboration with the Flowtechnology Benelux operation,
and the PMC division in general. The new business
will also act as a "springboard" for further complementary
acquisition activity in the Benelux region.
The consideration of approximately GBP2.8 million
is to be satisfied as to c.GBP2.1 million in cash
on completion, and the balance of c.GBP0.7 million
by the allotment of 495,179 new ordinary shares in
Flowtech (the "Consideration Shares"). to Leo Voogd.
In addition, an option over 330,119 shares is to be
issued with an exercise price of 138.7 pence. The
Group will also assume the net debt position of Hydroflex
at completion, which is expected to be cGBP0.6m. The
maximum total consideration, including assumed debt,
following any completion accounting adjustments is
c.GBP3.7 million.
The Consideration Shares have been credited as fully
paid and will rank pari passu in all respects with
the existing ordinary shares in the capital of the
Company in issue, including the right to receive all
dividends and other distributions declared, made or
paid in respect of such shares after the date of issue
of the shares. Application has been made for the Consideration
Shares to be admitted to trading on AIM and it is
expected that admission will become effective and
that dealings will occur on or around 13 September
2017 ("Admission").
On Admission, the Company's issued share capital will
consist of 52,157,195 ordinary shares. There are no
ordinary shares held in treasury. Therefore, in accordance
with the FCA's Disclosure and Transparency Rule 5.6.1,
the Company confirms that following Admission, the
total number of voting rights (TVR) in the Company
will be 52,157,195.
Sean Fennon, Chief Executive, Flowtech Fluidpower
plc commented:
"As a Board, we are delighted to add this successful
business to the Group's portfolio. We have, as stakeholders
know, wished to enhance our European presence and
this opportunity represents the first move internationally
for our PMC business. Having got to know that Hydroflex's
culture, model and aspirations near mirrors that of
our own, the new skills, customers and end markets
introduced will further strengthen Flowtech's profile,
product offering and technical expertise; this will
serve us well as we continue to roll-out our strategy
of building the leading fluid power group"
Leo Voogd, Managing Director of The Hydraulic Group
B.V. added:
"The opportunity to be involved with the exciting
developments of the Flowtech strategy in our region
was hugely influential in my decision to sell the
business. There are great synergies and this move
considerably enhances several aspects of our Benelux
business and offers new and exciting prospects for
all our employees. My team and I are looking forward
to working as part of this industry respected business
- we recognise that the strategy and the resources
now open to us make it possible to achieve significant
growth beyond what was achievable as an independent
business."
In summary, the Board of Flowtech remain very encouraged
about the future. The Group will be releasing its
Half Year results for the period ended June 2017 on,
Tuesday 12 September.
Note:
The majority of the consideration to be paid in Euros. The above
values have been converted at an exchange rate of 1.09 EUR/GBP
Enquiries:
Flowtech Fluidpower plc
Sean Fennon, Chief Executive
Bryce Brooks, Chief Financial Officer
Tel: +44 (0) 1695 52796
Email: info@flowtechfluidpower.com
Zeus Capital Limited (Nominated Adviser and Broker)
Andrew Jones, Alistair Donnelly (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 Hydroflex Group:
Hydroflex is a supplier and stockholder of hydraulic
components covering industrial hydraulic steering components,
high pressure hoses, hose assemblies and related products.
Supplying worldwide, the business is recognised for
providing total solutions to its global customers exploiting
its technical skills within its central warehouse based
in Oud-Beijerland, where the stockholding covers some
30,000 items, through to its offices in Rotterdam and
Brussels. Orders can be placed by telephone, e-mail
24/7 using a bespoke scan2order system. Specific core
markets include shipbuilding, general engineering,
oil and gas, offshore and petrochemicals and it has
some presence within both the OEM and MRO markets.
For more information please visit www.hydroflex.nl
About Flowtech Fluidpower plc
Founded as Flowtech in 1983, the Flowtech Group is
the UK's leading specialist supplier of technical fluid
power products. The business joined AiM in 2014. Today,
the business has three distinct divisions:
Division: What we do: Locations:
--------------- -------------------------------- ----------------------------------
Flowtechnology focus on supplying distributors Flowtechnology Benelux
and resellers of industrial (Deventer)
MRO products, primarily Flowtechnology China
serving urgent orders (Guangzhou)
rather than bulk offerings. Flowtechnology UK (Skelmersdale)
It offers an unrivalled Indequip (Skelmersdale)
range of OEM and Exclusive
Brand products to over
3,400 distributors and
resellers. The catalogue
is recognised as the
definitive source for
fluid power products,
containing 100,000 individual
product lines and are
distributed to more
than 80,000 industrial
MRO end users.
--------------- -------------------------------- ----------------------------------
Power Motion Specialise in the design, Primary Fluid Power
Control assembly and supply (Knowsley)
(PMC) of engineering components Nelson Fluid Power-
and hydraulic systems (Dublin, Lisburn, Dungannon)
and is further enhanced TSL Fluidpower (West
by a service and repair Yorkshire)
function, Albroco (Knowsley)
Hydraulics & Transmissions
(Ludlow)
HiPower Hydraulics (Cork,
Dublin, Belfast Manchester)
Hydroflex Hydraulics
(Brussels, Rotterdam
and OudBeijerland)
--------------- -------------------------------- ----------------------------------
Process focus on the supply Hydravalve, (Willenhall)
of industrial components Orange County (Spennymoor)
and solutions to the
process sectors.
--------------- -------------------------------- ----------------------------------
All three of the Group's divisions have overlapping
product sets, allowing procurement synergies to be
maximised
The divisions are supported by a centralised back office
team at the Skelmersdale site and a procurement and
quality control team in Shanghai. In total, the business
employs over 400 people. For more information please
visit, www.flowtechfluidpower.com
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.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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