Volex Share News (VLX)

(Sharecast News) - Cable assembly supplier Volex announced the acquisition of GTK, a UK-based manufacturer of customised electronic solutions including cable assemblies, displays and connectors, for a total consideration of £14.3m on Tuesday.The AIM-traded company said GTK was currently owned by funds administered by YFM Equity Partners and its management team.GTK is headquartered in Basingstoke, and has operations in the UK, Romania and Taiwan.In business for more than 25 years, it boasted more than 300 active customers and was focused on the Northern Europe market.For the year ended 31 July, GTK reported audited revenues of £15.8m and a pre-exceptional operating profit of £1.7m.Revenue had improved 49% over the last three years, representing an annual growth rate of 14.2%.On completion, GTK had cash on its balance sheet of £1.3m.Volex had acquired GTK for a total consideration of about £14.3m, representing a 5.7x multiple of adjusted historical operating profit.The company said the consideration was satisfied by a £12.5m payment in cash, and the balance by the issue of 2,124,016 new ordinary shares.Volex said the consideration shares were subject to a six-month lock-up."This acquisition, which is immediately accretive to our earnings per share, represents an important next step in expanding Volex's market-leading cable assemblies division," said Volex executive chairman Nat Rothschild."Furthermore, GTK's business introduces important new capabilities to our group, and brings new customer relationships, a highly skilled European-based sales and engineering team, and innovative new products."In addition, I am very pleased that Volex is back manufacturing in the UK after a gap of over 10 years."