TIDMHLMA
RNS Number : 9288A
Halma PLC
27 January 2020
Halma, the leading safety, health and environmental technology
group, today announces two acquisitions for its Medical and
Infrastructure Safety sectors respectively.
Acquisition of NovaBone Products, LLC
Halma has acquired NovaBone Products, LLC ("NovaBone"), a
designer and manufacturer of US FDA-approved synthetic bone graft
products, based in Florida, USA.
NovaBone's products are used to accelerate bone regeneration,
primarily for orthopaedic and dental surgical procedures in the USA
(see notes 1 and 2). It will become part of Halma's Medical sector,
which includes a range of diagnostic and surgical device companies
serving niche applications in global healthcare markets. NovaBone's
management team, who were significant shareholders, will continue
to lead the business from its current location.
The initial cash consideration for NovaBone is US$97 million
(GBP74 million(3) ), on a cash and debt free basis, which will be
funded from Halma's existing facilities. When adjusted for tax
benefits with a net present value of approximately US$11 million
(GBP8 million), the net initial consideration is approximately
US$86 million (GBP66 million). Additional earn-out considerations
are payable in cash, dependent on profit growth in each of the two
financial years to March 2022, up to an aggregate maximum of US$40
million (GBP31 million), with a maximum of US$25 million (GBP19
million) achievable in any single financial year.
NovaBone's revenue and Adjusted EBIT for the twelve months ended
December 2019 are forecast to be US$21.0 million (GBP16.0 million)
and US$6.9 million (GBP5.3 million), respectively.
Acquisition of FireMate Software Pty. Ltd.
Halma has acquired 70 per cent of FireMate Software Pty. Ltd.
("FireMate"), a Brisbane, Australia-based company which provides
cloud-based fire protection maintenance software to fire
contractors.
The cash consideration for 70 per cent of FireMate is payable in
two tranches. An initial A$11.8 million (GBP6.2 million(4) ) is
payable at closing and a further A$6.4 million (GBP3.3 million)
contingent on performance to 30 June 2022, resulting in a maximum
A$18.2 million (GBP9.5 million), which will be funded from Halma's
existing facilities. Halma also has an option to purchase the
remaining 30% of FireMate, exercisable in the six months from 31
March 2025.
FireMate's revenue and EBIT in the twelve months ended June 2019
were A$2.5 million (GBP1.3 million) and A$0.9 million (GBP0.5
million), respectively.
FireMate will be part of the Group's Infrastructure Safety
sector and will continue to be led by its current management
team.
Andrew Williams, Group Chief Executive at Halma, commented:
"These businesses are exciting additions to Halma, bringing new
technologies and market niches to two of our sectors and are highly
aligned to our purpose. Both businesses are well positioned to
benefit from the range of Halma's strategic Growth Enablers and we
look forward to working with their management teams to deliver
further growth.
NovaBone extends our Medical sector's presence in surgical
applications, adding a new niche within the orthopedics market,
which is growing fast due to the ageing population and increasingly
sedentary lifestyles causing joint problems. It has strong
technology and knowhow within the fast-growing biologics segment,
developing biomaterials that harnesses the body's natural healing
process to accelerate bone growth.
FireMate's software solutions are highly complementary to those
currently offered by our Infrastructure Safety sector's fire
businesses and further strengthen our capabilities in connected and
integrated fire systems internationally."
For further information, please
contact:
Halma plc
Andrew Williams, Group Chief Switchboard: +44 (0)1494 721111
Executive
Marc Ronchetti, Chief Financial
Officer
Charles King, Head of Investor Mobile: +44 (0)7776 685948
Relations
MHP Communications
Rachel Hirst/ Andrew Jaques +44 (0)20 3128 8771
About Halma
Halma is a global group of life-saving technology companies,
focused on creating a safer, cleaner and healthier future for
people worldwide. Our innovative products and solutions address
many of the key issues facing the world today. We operate in four
sectors: Process Safety, Infrastructure Safety, Environmental &
Analysis and Medical. We employ over 6,000 people in 20 countries,
with major operations in Europe, the USA and Asia-Pacific. We
target global niche markets where sustainable growth and high
returns are supported by long-term drivers. Halma is listed on the
London Stock Exchange and is a member of the FTSE 100 index.
Notes
1. The orthopaedic and dental bone graft markets are growing
rapidly, driven by ageing populations and increasingly sedentary
lifestyles. NovaBone's growth is further supported by an increase
in spine fusion procedures and the greater use of synthetic bone
grafts rather than traditional surgical methods which use cadavers
or secondary bone graft sites. The global market for bone
replacement products is valued at approximately US$4.3 billion and
is growing at approximately 7% p.a., with the market in the USA
representing approximately US$1.4 billion.
2. NovaBone's primary markets are the orthopaedic synthetic bone
graft market, which accounts for approximately 90% of its revenue,
and the dental market. Approximately 85% of revenue is generated in
the USA, and NovaBone also serves customers in markets including
Australia, China, the Middle East, Brazil and India. NovaBone
intends to retain its current distribution arrangements in the
markets it serves. NovaBone's products are approved for use by the
U.S. Food & Drug Administration (FDA) and in several other
markets globally.
3. US Dollar (US$) values are translated throughout this announcement at a rate of US$1.31: GBP1
4. Australian Dollar (A$) values are translated throughout this
announcement at a rate of A$1.91: GBP1
5. This statement is not intended to constitute a profit
forecast for the current financial period or for any future period.
In addition, this statement should not be taken to mean that the
earnings per share of Halma will necessarily match or exceed the
historic reported earnings per share of Halma.
6. For more information on Halma's Growth Enablers visit:
https://www.halma.com/how-we-grow#page-intro-2
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END
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