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LONDON (Alliance News) - Ventilation products company Volution Group PLC struck a deal on Tuesday to buy fan coils and commercial heating products company Energy Technique PLC for around GBP9.3 million, as the target company said its pretax profit and revenue both increased in the first half.
Volution will pay 345.00 pence per share for AIM-listed Energy Technique, a 10% premium to its closing price on February 25, the day before the offer period opened. Energy Technique hired Cavendish Corporate Finance LLP in February to find a buyer for the business and has been in talks with potential suitors since.
Energy Technique shares were up 10% to 330.00 pence per share, one of the best performers in the AIM All-Share, giving it a market capitalisation of GBP7.9 million. Volution shares were down 1.2% to 188.56p.
"This proposed acquisition is consistent with our stated strategy of making disciplined and value enhancing acquisitions. We believe that Energy Technique has a strong presence as a supplier to the UK New Build Commercial market which is highly complementary to our strong position in the UK New Build Residential sector," said Volution Chief Executive Ronnie George.
"We are excited by the growth prospects for Energy Technique and increasing our scale in the Commercial HVAC sector. We believe the acquisition will deliver value for our shareholders and consolidate our position in the UK HVAC market," George added.
The takeover news came as Energy Technique said its pretax profit for the half to the end of September rose to GBP613,000 from GBP459,000 a year earlier, with revenue rising to GBP5.9 million from GBP5.4 million.
The company expects to deliver growth in sales and profit over the course of the full 2016 financial year, with enquiries and order intake both at high levels.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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