good acquisition20 Nov 2015 18:31
Conditional Acquisition
Billington Holdings Plc, one of the UK's leading structural steel and construction safety solution specialists, today announces it has conditionally agreed to acquire property located at Shafton, from Sabler Enterprises Limited for £2.5m and equipment and other assets, also located at Shafton from Sherling Steel (UK) Ltd for £2.38m (together the "Acquisition").
In the short term, the planned acquisition would give Billington access to new machinery and increased capacity. After completion, the facilities will be adapted for optimum production and, within three years, the directors believe that the new facilities will significantly increase the output of Billington's structural steelwork divisions.
At 30 June 2015 Billington had a cash position of £6.36m. The Acquisition will be partially funded through the Company's own cash resources and partially from a commercial mortgage from the Company's bankers, HSBC. The directors believe the commercial mortgage, currently agreed in principal, along with current agreed facilities, provides the Group with adequate facilities to service its growth strategy and additional working capital requirements as volumes increase.
Sabler Enterprises Limited ("Sabler")
Billington has entered into a conditional agreement to acquire a 25 acre site from Sabler. The site contains two industrial buildings with a combined useable area of 181,000 sq ft. The site is partially occupied by several long term tenants. The Acquisition agreement is contingent upon a number of conditions being satisfied including completion of satisfactory environmental due diligence and the transfer of the existing leases along with the grant of certain new leases on common market terms.
Sherling Steel (UK) Ltd ("Sherling")
Billington Structures Limited, the wholly owned subsidiary of Billington, has entered into a conditional agreement to acquire equipment and other related assets. The acquisition is conditional on the completion of the acquisition agreement with Sabler set out above. The key assets are steel processing machinery and associated lifting equipment that the Directors believe will further enhance the Group's capabilities and ability to offer additional products that complement the current portfolio.
The directors believe the consideration reflects the current value of the property and the operating assets.
Commercial Proposition
It is proposed that Billington will utilise the site and equipment at Shafton to complement its structural steel divisions located at Barnsley and Bristol. The directors believe the acquisition of the property, equipment and other assets represents an excellent opportunity for the Company to further service its client portfolio and presents opportunities for diversification of its current activities.
Assuming the Acquisition completes, there would be a period of transiti
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