LONDON (Alliance News) - Machine tools and laser-marking company The 600 Group PLC Monday said it has acquired a 26.3% stake in fellow AIM stock ProPhotonix Ltd, financing the deal with a share issue.
The deal comes just months after 600 Group told Alliance News that it would look to bolster the business through acquisitions.
600 Group said the deal would make it the biggest shareholder in the US's Prophotonix, a Salem, New Hampshire-based LED systems manufacturer. It comprises two businesses based respectively in Cork, Ireland and in Hatfield Broad Oak in the UK.
As part of the financing for the deal, 600 Group will issue 4,925,621 shares, representing 5.5% of its issued share capital.
"This should be construed as a strategic investment in a company with interesting business activities and improving prospects," said 600 Group Chairman Paul Dupee.
In June, 600 Group, which was subject to a takeover bid by China-based Qingdao D&D Investment Group Co Ltd in 2013, said it was in negotiations to acquire marker-related companies. The Laser market is growing much more rapidly than the machine tools industry, and the company is looking to capitalise on this.
600 Group shares were down 1.7% to 22.00 pence on Monday, but ProPhotonix shares were down much more heavily on the news, falling 20% to 1.81 pence and making it one of the biggest losers on AIM in morning trade.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance and Anthony Tshibangu; anthonytshibangu@alliancenews.com
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