Diploma Regulatory News (DPLM)

3 Aug 2007 07:00

Diploma PLC03 August 2007 12 CHARTERHOUSE SQUARE, LONDON EC1M 6AX TELEPHONE: +44 (0)20 7549 5700 FACSIMILE: +44 (0)20 7549 5715 FOR IMMEDIATE RELEASE 3 August 2007 DIPLOMA ACQUIRES CABLETEC FOR A MAXIMUM OF £6.7m Diploma PLC, the international specialised distribution group, is pleased to announce the acquisition of Cabletec Interconnect Components Systems Limited ("Cabletec"), a leading supplier of wiring and connector products to the aerospace, defence and commercial electronics industries. Cabletec is based in Weston-super-Mare, near Bristol, where it operates from a two acre freehold site comprising 22,000 square feet of office, warehouse and manufacturing facilities. Cabletec employs 65 staff. Cabletec's traditional business is the distribution of a range of specialised wiring and harness components which are very similar to those supplied by the Group's existing subsidiary, IS-Rayfast. The customer base is made up of Tier 2 and Tier 3 sub-contractors and repairers also serviced by IS-Rayfast. In addition, Cabletec supplies a range of manufactured products, including braids, connectors and multi-core cables which give greater access to the Tier 1 OEM's. Own manufactured earth bonding and shunt products are also supplied to the industrial and energy sectors. Prior to acquisition, Cabletec was owned by its management comprising Mr and Mrs A Auty, in their personal capacities and as trustees of the Auty Family Settlement, Mr J Moore and Mr M Bennett as trustee of the Auty Family Settlement. The existing Managing Director of Cabletec, Mr J Moore, and his management team will continue in their roles after acquisition and will report into the IS Group. Operating profit before tax for Cabletec in the year ended 31 December 2006 was £0.6m on sales of £6.5m; gross assets at 31 December 2006 were £4.4m. At completion, net assets are expected to be approximately £2.3m, including net cash of approximately £0.4m. The initial cash consideration to be paid, which will be met from the Group's existing cash resources, is £6.2m, before acquisition costs, which includes the freehold property valued at a minimum of £1.0m. The consideration may be subject to a minor adjustment, based on the net assets at completion. Further deferred consideration up to a maximum of £0.5m will be payable, depending on the gross profit of Cabletec achieved in the twelve months following completion. Bruce Thompson, Chief Executive of Diploma PLC said: "The acquisition of Cabletec fits well with Diploma's strategy in its Controls Sector of increasing its presence in quality-sensitive market segments such as Aerospace, Defence, Rail and Power. The acquisition will broaden the product portfolio and add further depth to our operation by adding a company with proven added value and niche manufacturing skills." For further enquiries please contact: Bruce Thompson, Chief Executive Officer 020 7549 5700 Nigel Lingwood, Group Finance Director 020 7549 5705 Ian Seaton, Bankside Consultants 020 7367 8891 NOTE TO EDITORS: Diploma PLC is an international group of specialised distribution businesses operating in three sectors: Life Sciences - suppliers of consumables, instrumentation and related services to research, environmental and clinical diagnostic laboratories. Principal companies are Anachem, a1-envirosciences and CBISS in Europe and Somagen in Canada. Seals - Suppliers of hydraulic seals, gaskets, cylinders and attachment kits for heavy mobile machinery. Principal companies are Hercules Bulldog Sealing Products and HKX in North America and FPE in the UK. Controls - Suppliers of specialised wiring, connectors, control devices and fasteners for a range of technically demanding applications. Principal companies are the IS Group in the UK and US, Sommer Filcon in Germany and Hawco in the UK. Within each of these sectors, the Diploma businesses serve industry segments with long term growth potential and with the opportunity for sustainable superior margins through the quality of customer service, depth of technical support and value adding activities. Further information on Diploma PLC can be found at www.diplomaplc.com This information is provided by RNS The company news service from the London Stock Exchange