Volex Regulatory News (VLX)

8 October 2021

Volex plc

("Volex" or the "Company")

Acquisition of Prodamex SA de CV and Terminal & Cable TC Inc. for CAD$22.5 million

Expands presence and capabilities in key North American market

Volex plc (AIM:VLX), the global supplier of integrated manufacturing services and power products, is pleased to announce that it has signed a share purchase agreement for the acquisition of the entire issued share capital of Prodamex SA de CV ("Prodamex") and Terminal & Cable TC Inc. ("TC"), for a total consideration of CAD$22.5 million (the "Acquisition"). The consideration will be paid in cash from the Company's existing debt facilities at completion, expected to be in Q3 FY2022 subject to customary closing conditions including regulatory approvals in Canada.

Prodamex and TC are autonomous operating businesses being acquired from an investment holding company based in Canada and will expand Volex's capabilities in the key North American market in the domestic appliance, defence and off-highway industries.

The transaction will be earnings enhancing from completion.

Strategic Rationale - Prodamex

· Prodamex provides an advanced manufacturing facility serving customers in Mexico, the USA and Canada. This facility delivers additional manufacturing capability in Central Mexico, tailored to the delivery of higher volume requirements. This will complement Volex's manufacturing plants in Tijuana and Juarez and will create additional flexibility for customers

· The business has longstanding expertise in wire harnesses for domestic appliances and provides cross-selling opportunities with Volex's existing investments in DE-KA and the recently expanded facility in Batam, Indonesia, establishing a global low-cost presence to service the white goods and commercial markets

· Creates opportunities for further cost synergies through leveraging our global supply chain

Strategic Rationale - TC

· One of the largest wire harness manufacturers in Canada with over 50 years' experience, and a leading defence supplier, establishing a strong Canadian market presence for Volex

· Complements the recent Irvine acquisition and broadens Volex's defence market capabilities into armoured vehicle solutions, offering opportunities to support long-term customer programmes

· Ruggedised wire harness capabilities allowing expansion into the attractive "off-highway" market sector supporting industrial, agricultural and construction machinery manufacturers

Acquisition Highlights

• Consideration represents 7.7x EBITDA for the year ended 31 May 2021

• For the year ended 31 May 2021 combined revenues were CAD$31.4 million, EBITDA was CAD$2.9 million and profit before tax was CAD$2.4 million. Net assets at 31 May 2021 were CAD$6.4 million

• We expect to retain the operational management teams at each business following the completion of the acquisition

• On completion of the transaction, Volex will continue to have the financial flexibility to progress opportunities in its exciting acquisition pipeline

Commenting on the Acquisition, Nat Rothschild, Executive Chairman of Volex said:

"The acquisitions of Prodamex and TC further expand our geographic coverage and technical capabilities in North America. Each of these businesses represent a compelling acquisition in markets that offer us growth opportunities.

Prodamex complements the recent acquisition of DE-KA in the white goods market, expanding our capabilities into the North American market while TC builds on the recent acquisition of Irvine and our strategic intent to develop Volex's presence in the defence market, broadening our offering into military vehicle wiring harnesses.

These acquisitions are a further indication of our ability to identify and acquire attractive businesses for compelling valuations. Our buy and build strategy, along with our pursuit of operational excellence and organic growth, are a key element of our strategy as we target $650 million in revenues and $65 million of underlying operating profit by 2024."

About Prodamex

Prodamex, a Mexico based manufacturer of wire harness solutions, was founded in 2007. The company supports major global domestic appliance customers from its 60,000 square foot manufacturing site.

About TC

TC, a Canada based manufacturer of wire harness solutions, was founded in 1968. The company principally supplies major defence customers, with other customers in off-highway automotive sectors. It has a 40,000 square foot manufacturing site which is accredited to stringent international quality standards.

For further information please contact:

Volex plc +44 (0)7971 156 431

Nat Rothschild, Executive Chairman

Jon Boaden, Chief Financial Officer

Christian Bedford, Group General Counsel and Company Secretary

Singer Capital Markets - Nominated Adviser & Joint Broker +44 (0)20 7496 3000

Shaun Dobson

George Tzimas

HSBC Bank plc - Joint Broker +44 (0)20 7991 8888

Simon Alexander

Joe Weaving

Powerscourt - Media Enquiries +44 (0)20 7250 1446

James White

Ollie Head

About Volex

Volex plc (AIM:VLX) is a global leader in integrated manufacturing for performance-critical applications and a supplier of power products. We serve a diverse range of markets and customers, with particular expertise in cable assemblies, higher-level assemblies, data centre power and connectivity, electric vehicles and consumer electricals. We are headquartered in the UK and operate from 17 manufacturing locations with a global workforce of over 6,300 employees across 21 countries. Our products are sold through our own locally based sales teams and through authorised distributor partners to Original Equipment Manufacturers ('OEMs') and Electronic Manufacturing Services ('EMS') companies worldwide. All of the products and services that we offer are integral to the increasingly complex digital world in which we live, providing power and connectivity from the most common household items to the most complex medical equipment. For more information, please visit www.volex.com

ENDS