TIDMFAN
RNS Number : 1555H
Volution Group plc
02 August 2021
Monday 2 August 2021
Volution Group plc
Acquisition of Energy Recovery Industries
Volution Group plc ("Volution" or "the Group" or "the Company",
LSE: FAN), a leading international designer and manufacturer of
energy efficient indoor air quality solutions, is pleased to
announce that it has signed an agreement to acquire Energy Recovery
Industries(1) ("ERI"), a leading manufacturer and supplier of
low-carbon, energy efficient heat exchanger cells, for an initial
consideration of EUR23.4 million on a debt free cash free basis,
with a further contingent cash consideration of up to EUR12.4
million based on stretching targets for the financial results for
the year ending 31 December 2023.
ERI designs and manufactures a range of innovative and highly
efficient aluminium heat exchanger cells for use primarily in
commercial heat recovery ventilation systems. Products are
manufactured in ERI's modern, high quality production facility in
Bitola, North Macedonia, and are supplied to heat recovery and air
handling unit manufacturers predominantly in Europe, including
existing Volution Group companies.
A comprehensive and pre-existing expansion plan is in progress
which will include the acquisition of adjacent land, extension of
the factory and further investment in machinery and automation, to
support ERI's growth ambitions. Sales and distribution entities in
Italy, Spain and the U.K. also form part of the transaction, and
the founding major shareholder Umberto Fiorentini and his senior
management team will remain with the business and continue to lead
it post completion. The Managing Director and minority shareholder
of the U.K. sales entity, Michael Parker, will continue to own 49%
of the shares of the U.K. entity.
For the financial year ended 31 December 2020, ERI generated
revenue of EUR11.3 million and profit before tax of EUR2.0 million,
with gross assets of EUR7.6 million. Revenue is growing at
double-digit rates in calendar year 2021 and the acquisition is
expected to be immediately earnings accretive for the Group.
Completion of the transaction is conditional on approval of the
Merger Authority in North Macedonia, and is expected to take
approximately four to six weeks. The transaction will be funded
from existing cash and the Group's Sustainability Linked Revolving
Credit Facility.
Ronnie George, Volution Chief Executive Officer, commented:
"We are delighted to reach agreement to acquire Energy Recovery
Industries and to add this exciting Low Carbon technology to our
Group's capabilities. The increasing focus of governments in
achieving their local net zero carbon targets, the International
Building Regulation response plus key recommendations made recently
in the "Fit for 55"(2) announcement are all structural growth
drivers for the use of heat recovery cells. The combination of
Volution's appetite to invest and the ERI team's expertise in this
area of the market will make for an exciting combination."
(1) Acquisition encompasses 100% of ERI Corporation DOO Bitola
(North Macedonia), 100% of ERI Corporation S.R.L. (Italy), 100% of
Energy Recovery Industries Trading SLU (Spain) and 51% of Energy
Recovery Industries Corporation Ltd (UK).
(2.) "Fit for 55" is the European Commission legislative package
supporting its commitment to reduce net greenhouse gas emissions by
at least 55% by 2030.
-ends-
For further information:
Volution Group plc
Ronnie George, Chief Executive
Officer +44 (0) 1293 441501
Andy O'Brien, Chief Financial
Officer +44 (0) 1293 441536
+44 (0) 207 353
Tulchan Communications 4200
James Macey White
Giles Kernick
Certain information contained in this announcement would have
constituted inside information (as defined by Article 7 of
Regulation (EU) No 596/2014 as amended by The Market Abuse
(Amendment) (EU Exit) Regulations 2019) prior to its release as
part of this announcement.
Volution Group plc Legal Entity Identifier:
213800EPT84EQCDHO768.
Note to Editors:
Volution Group plc (LSE: FAN) is a leading international
designer and manufacturer of energy efficient indoor air quality
solutions. Volution Group comprises 18 key brands across three
regions:
UK: Vent-Axia, Manrose, Diffusion, National Ventilation,
Airtech, Breathing Buildings, Torin-Sifan.
Continental Europe: Fresh, PAX, VoltAir, Kair, Air Connection,
Rtek, inVENTer, Ventilair, ClimaRad.
Australasia: Simx, Ventair, Manrose.
For more information, please go to: www.volutiongroupplc.com
Cautionary statement regarding forward-looking statements
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made in good faith and are based on current expectations or
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undue reliance on these forward-looking statements, which are not a
guarantee of future performance and are subject to factors that
could cause our actual results to differ materially from those
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this document, whether as a result of new information, future
events or otherwise.
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END
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