Volex PLC Acquisition of GTK (0354K)
11 December 2018 - 6:01PM
UK Regulatory
TIDMVLX
RNS Number : 0354K
Volex PLC
11 December 2018
Volex plc
Acquisition of GTK
11 December 2018
Volex plc ("Volex" or the "Company"), the global provider of
cable assemblies, is pleased to announce the acquisition of GTK
(Holdco) Limited ("GTK"), a UK-based manufacturer of customised
electronic solutions including cable assemblies, displays and
connectors, for a total consideration of approximately GBP14.3
million. GTK is currently owned by funds administered by YFM Equity
Partners and its management team.
GTK is headquartered in Basingstoke and has operations in the
UK, Romania and Taiwan. In business for over 25 years, it has more
than 300 active customers and is focused on the Northern European
market.
For the year ended 31 July 2018, GTK reported audited revenues
of GBP15.8 million and a pre-exceptional operating profit of GBP1.7
million. Revenue has increased by 49 per cent over the last three
years, representing an annual growth rate of 14.2 per cent. On
completion, GTK had cash on balance sheet of GBP1.3 million.
Volex has acquired GTK for a total consideration of
approximately GBP14.3 million, representing a 5.7 times multiple of
adjusted historical operating profit.(1) The consideration has been
satisfied by a GBP12.5 million payment in cash, and the balance by
the issue of 2,124,016 new ordinary shares of 25 pence each in the
Company (the "Consideration Shares"). The Consideration Shares are
subject to a six-month lock-up.
Nat Rothschild, Executive Chairman of Volex, commented:
"This acquisition, which is immediately accretive to our
earnings per share, represents an important next step in expanding
Volex's market-leading cable assemblies division. Furthermore,
GTK's business introduces important new capabilities to our group,
and brings new customer relationships, a highly skilled
European-based sales and engineering team, and innovative new
products. In addition, I am very pleased that Volex is back
manufacturing in the UK after a gap of over 10 years."
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 8.00am on 14
December 2018.
Following the issue of the Consideration Shares, the issued
share capital of the Company will comprise 147,367,933 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.
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulations (EU) No. 596/2014.
Note:
(1) Historic audited operating profit has been adjusted for the
purposes of this calculation to add back goodwill amortisation,
one-off charges and certain shareholder costs that will not
continue under Volex ownership.
Enquiries
For further information please contact:
Volex plc Tel: 07909 995 887
Nat Rothschild, Executive Chairman
Daren Morris, Chief Financial Officer and Company Secretary
Liberum Tel: 020 3100 2222
Financial Adviser
Karri Vuori
Nominated Adviser & Broker
Steve Pearce
Euan Brown
Quercus Corporate Finance LLP
Adviser to GTK
Amanda Hall Tel: 07973 417 087
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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