Senior PLC Acquisition (0857J)
April 01 2015 - 1:00AM
UK Regulatory
TIDMSNR
RNS Number : 0857J
Senior PLC
01 April 2015
Acquisition of Lymington Precision Engineering
Senior plc ("Senior" or "the Group") is pleased to announce that
it has acquired 100% of the issued share capital of Lymington
Precision Engineering (LPE) Limited ("LPE" or "the Company"), from
management and Vine Street Capital, for an initial consideration of
GBP45.8m on a debt free/cash free basis. This was all paid in cash
on completion of the acquisition.
Additional "earn-out" consideration of up to GBP31.7m is
potentially payable, dependent upon the financial performance of
LPE during the 12 month period ending 31 March 2016. GBP10.0m of
the earn-out consideration was paid into escrow upon
acquisition.
LPE is a leading manufacturer of precision-machined components,
fabrications, assemblies and kit sets for the oil and gas,
telecommunications, aerospace, defence, land and sea systems,
nuclear and marine industries.
The Company is based in Lymington, Hampshire, UK and employs 225
people. It has been operating for over 30 years and has 121,000 sq.
ft. of manufacturing space equipped with the latest manufacturing
technology. This includes numerous multi-axis CNC machines, with
turning and milling capability up to 4 metres in length and
flexible manufacturing systems capable of unmanned working to
produce components to close tolerances 24 hours per day.
LPE will form part of Senior's Flexonics Division with the
current management team staying with the business following
acquisition.
For the year ended 31 March 2014, LPE reported sales of GBP42.7m
and trading profit before interest, tax, depreciation and
amortisation ("EBITDA") of GBP7.0m. For the year ending 31 March
2015, LPE expects to report sales of GBP51.2m and EBITDA of
GBP9.0m. Gross assets of the business at 31 March 2014 were
GBP25.4m.
The acquisition will be funded using the Group's existing
borrowing facilities, a new two-year GBP20m revolving credit
facility and new one-year term loans totalling GBP25m.
Due to the current short-term uncertainties in the oil and gas
market, which accounts for 85% of LPE's sales, the financial
performance of the Company is expected to be materially lower over
the next twelve months than that experienced in the recent past.
The acquisition is, however, still expected to be immediately
earnings enhancing. Following the acquisition, sales to the oil and
gas sector will represent approximately 5% of Group revenue.
LPE's impressive capabilities and customer focus, together with
contracted growing revenue from existing nuclear, marine and
aerospace customers, mean the Company's future prospects are
encouraging. In addition, LPE is very well-positioned to benefit
from a recovery in the oil and gas industry when it comes.
Commenting on the acquisition, Mark Rollins, Senior's Group
Chief Executive, said:
"I am very pleased to announce the acquisition of LPE and to
welcome all of its employees to the Group. LPE represents an
excellent addition to Senior's portfolio, strengthening the Group's
precision machining capabilities and providing access to LPE's
strong customer relationships and adjacent markets. Combined with
Senior's wider market access and financial strength, LPE represents
an excellent platform to enhance the longer-term growth prospects
for the Senior Group."
Further information
Group Chief Executive, Senior
Mark Rollins plc +44 (0) 1923 714 738
Group Finance Director, Senior
Derek Harding plc +44 (0) 1923 714 722
Philip Walters RLM Finsbury Group +44 (0) 20 7251 3801
About Senior
Senior is an international manufacturing Group with operations
in 14 countries. It is listed on the main market of the London
Stock Exchange (symbol SNR). Senior designs, manufactures and
markets high technology components and systems for the principal
original equipment producers in the worldwide aerospace, defence,
land-vehicle and energy markets. Further information on Senior plc
may be found at: www.seniorplc.com
About LPE
A privately held company, LPE has been a leading manufacturer of
precision machined components, fabrications, assemblies and kit
sets for many industries for over 30 years. Further information on
LPE may be found at: www.lymingtonprecision.co.uk
Cautionary Statement
This announcement contains certain forward-looking statements.
Such statements are made by the Directors in good faith, based on
the information available to them at the time of the announcement,
and they should be treated with caution due to the inherent
uncertainties underlying any such forward-looking information.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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