LONDON (Alliance News) - Shares in engineering firm TP Group PLC jumped Wednesday after it acquired Sapienza Consulting Holding BV for up to EUR13.5 million in a cash-and-shares deal as it looks to expand its space and defence business.
Shares in TP were 5.1% higher at 6.78 pence on Wednesday.
TP will pay an initial cash consideration of EUR10.0 million and a further EUR1.5 million through the issue of 20.6 million shares in TP. A further EUR2.0 million may also be payable after two years should Sapienza achieve financial targets.
The cash element will be funded by TP from existing cash resources.
The purchase of Sapienza is expected to be earnings enhancing in 2019 and "significantly" earnings enhancing in 2020, TP said.
The Dutch company provides software and technical consultancy services for space missions, with clients including the European Space Agency.
In 2018, Sapienza generated EUR700,000 pretax profit on revenue of EUR18.9 million. Over the same period, TP reported a pretax loss of GBP100,000 on revenue of GBP39.0 million.
"Several of the existing group leadership team have experience in the space sector, and we see significant opportunities to leverage the skills and technologies of both Sapienza and TP Group across the enlarged global footprint," TP Chief Executive Officer Phil Cartmell said.
"We believe this acquisition enhances our unique business by further augmenting our ability to deliver services and skills into highly complex and critical environments", Cartmell added. "The combination of the two businesses presents a compelling opportunity for future success."
