CIU.L Regulatory News (CIU)

19 Oct 2006 07:01

Cape PLC19 October 2006 Cape PLC ("Cape" or the "Company") Acquisition of DBI Group Limited Cape PLC (AIM:CIU), the international provider of support services for theenergy sector, announces the acquisition of DBI Group Limited and itssubsidiaries DBI Industrial Services Limited and DBI Offshore Services Limited("DBI"). The initial consideration is £12.0 million and, subject to DBI meeting earningsgrowth targets over the next two years, up to a further £7.25 million will bepayable taking the maximum potential consideration to £19.25 million. Theinitial consideration has been paid in cash and the additional considerationwill be payable in a mixture of cash, loan notes, Cape shares and options overCape shares. DBI operates across the UK and provides onshore and offshore specialist cleaningservices to a number of large blue chip clients in the pharmaceutical, oil,petrochemical and manufacturing industries. Clients include BASF, BluewaterServices, BP, Corus, Dow Corning, Ineos Chlor, Maersk, Mitsui Babcock, andTotal. In the year to 30 September 2005, DBI's turnover was £11.5 million and earningsbefore interest, tax, depreciation and amortization were £1.9 million. Theapproximate value of the assets acquired at completion is £1.7 million andCape's Directors are of the opinion that the acquisition will be earningsenhancing. Cape is also pleased to announce that it has secured a new £60 million five yearcommitted facility from Barclays Bank Plc and Bank of Scotland, Corporate, Leedsoffice, arranged by Barclays Capital. The facility comprises a term loan of upto £13 million to fund the acquisition of DBI and revolving credit and otherfacilities totaling £47 million for working capital and other purposes(including the payment of the additional consideration). The new facility, whichis on improved terms, replaces the previous Barclay's facility other than inrespect of the £15 million term loan used to part fund Cape's asbestos fund,which remains in place and unamended. British Linen Advisers, PricewaterhouseCoopers LLP and DLA Piper UK LLP haveadvised Cape on this transaction. Cape's Chief Executive Martin May commented: "The purchase of DBI Group's industrial services and offshore cleaning businesswill further strengthen the multi-discipline services we offer to our clients.DBI has a very good reputation, an excellent health and safety record and astrong management team who aim to build on the success already achieved. DBI is an excellent fit for Cape as we have a number of significant clients incommon, a similarly exacting approach to matters of health and safety and a wellmatched geographic footprint. DBI brings an additional level of technicalspecialization to Cape's existing industrial cleaning services. We expect thecombination to bring immediate benefits to both businesses. The acquisition of DBI marks a first step to the fulfilment of Cape'sacquisitive growth strategy and is a clear indication of Cape's commitment toensuring it continues to provide a full range of services to its blue chipclient base. The new bank facility with Barclays and Bank of Scotland provides asignificantly increased level of working capital which will enable Cape to driveforward its growth strategy in the UK and Middle East." ENDS For further information, please contact: Cape PLCMartin May, Chief Executive +44 (0)1924 876 276 Bell Pottinger Corporate & FinancialNick Lambert +44 (0)20 7861 3232 / +44 (0)7811 358 764 Notes to editors Cape PLC is the parent company of a number of service providing organisationsoperating primarily in the oil and gas, petrochemical and power generationindustries. In the year to 31 December 2005, Cape reported turnover of £261.8million and currently employs c. 7,700 people in 23 countries worldwide. Cape specialises in the provision of scaffolding, insulation, fire protection,specialist cleaning and other essential services to major industrial clients inthe energy sector. In the UK, Cape also operates as Cape Hire, Cape Security. Cape also operates inBahrain and Saudi Arabia under the name RB Hilton. This information is provided by RNS The company news service from the London Stock Exchange