TIDMDSCV
RNS Number : 3044E
discoverIE Group plc
17 October 2018
7.00am, 17 Oct 2018
discoverIE Group plc
Acquisition of the Cursor Controls Group
discoverIE Group plc (LSE: DSCV, "discoverIE" or the "Group"), a
leading international designer, manufacturer and supplier of
customised electronics to industry, today announces the acquisition
of the Cursor Controls Group via the purchase of its holding
company Castlegate 737 Limited ("Cursor Controls").
Cursor Controls, which is a designer and manufacturer of human
to machine interface ("HMI") products for medical, industrial and
transportation applications, has been acquired for an initial cash
consideration of GBP19.0m on a debt free, cash free basis, before
expenses, funded from the Group's existing debt facilities. In
addition, a contingent payment of up to GBP4.0m will be payable
subject to Cursor Controls achieving certain profit growth targets
during the three year period ended 31 December 2021. The
acquisition is expected to be immediately enhancing to Group
underlying earnings as well as accretive to the Group's underlying
operating margin.
Cursor Control's products, which comprise trackballs, touchpads
and ruggedised keyboards, are custom designed for specific
applications, and are highly complementary to the Group's existing
business. The acquisition is consistent with discoverIE's strategic
focus on structural growth markets with over 60% of its revenues
derived from medical and industrial sectors. Over 90% of its sales
are to international markets, with 40% being into America, Asia and
other non-EU markets. The business, which is based in Newark, UK,
with manufacturing facilities in the UK and Belgium, will operate
within the Group's Design & Manufacturing division whilst
retaining its distinct brand identity.
The business has grown consistently over recent years, with
revenues for the year ended 31 December 2017 of GBP7.9m generating
a reported pre-tax profit of GBP0.3m, an underlying operating
profit(1) of GBP2.1m and an underlying operating margin of 26%.
Gross assets(2) at 31 December 2017 were GBP9.9m on a reported
basis.
Cursor Controls has been acquired from its shareholders being
Cursor Controls' management team, who will continue in their roles,
a number of former managers and Maven Capital Partners.
Nick Jefferies, Group Chief Executive of discoverIE plc,
said:
"The acquisition of Cursor Controls continues our strategy of
building a differentiated, international, growth focused
electronics Group with higher operating margins. Cursor Controls
has a well-established track record of supplying high quality
trackballs, trackpads and rugged keyboards internationally and into
growth markets. They will gain access to our wider base of
customers and with it, new sales opportunities. We are delighted to
welcome them and all their employees into discoverIE Group."
For further information please contact:
discoverIE Group plc 01483 544 500
Nick Jefferies - Group Chief Executive
Simon Gibbins - Group Finance Director
Instinctif 020 7457 2020
Mark Garraway
James Gray
Notes
1. Underlying operating profit excludes finance charges,
exceptional items, restructuring and shareholder costs.
2. Gross assets are the total of non-current assets plus current assets.
3. The information contained within this announcement is deemed
by the Group to constitute inside information as stipulated under
the Market Abuse Regulation, Article 7 of EU Regulation 596/2014.
Upon the publication of this announcement via Regulatory
Information Service, this inside information is now considered to
be in the public domain.
Notes to Editors:
About discoverIE Group plc
discoverIE Group (LSE: DSCV; previously Acal plc) is an
international group of businesses that designs, manufactures and
supplies innovative components for electronic applications.
The Group provides application-specific components to original
equipment manufacturers ("OEMs") internationally. With in-house
engineering capability, we are able to design components to meet
customer requirements, which are then manufactured and supplied,
usually on a repeating basis, for their ongoing production needs.
This generates a high level of recurring revenue and long term
customer relationships.
By focussing on key markets which are driven by structural
growth and increasing electronic content, namely renewable energy,
transportation, medical and industrial connectivity, the Group aims
to achieve organic growth that is well ahead of GDP and to
supplement that with targeted complementary acquisitions.
The Group employs c.4,000 people and its principal operating
units are located in Continental Europe, the UK, China, Sri Lanka,
India and North America.
The Group is listed on the Main Market of the London Stock
Exchange and is a member of the FTSE Small Cap Index, classified
within the Electrical Components and Equipment subsector, and has
revenue of GBP0.4bn. Over the last five years, revenue and
underlying earnings per share have doubled.
This information is provided by RNS, the news service of the
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END
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