VTC.L Regulatory News (VTC)

7 Nov 2006 07:02

The Vitec Group PLC07 November 2006 Date: 7 November 2006 The Vitec Group plc Acquisition of Tomcat Introduction The Vitec Group plc ("Vitec" or the "Group") announces that it has acquiredTomcat Global Corporation ("Tomcat"), a leading US manufacturer of aluminiumstructures for live events, for an initial cash consideration of US$14.5 million(£7.6 million) and deferred cash consideration of up to US$8.3 million (£4.4million) conditional upon future profitability targets (the "Acquisition"). TheAcquisition has been funded from existing resources and is expected to beslightly earnings enhancing in the financial year ending 31 December 2007 (seenote 1). Commenting on the Acquisition, Gareth Rhys Williams, Chief Executive of Vitec,said: "The Board believes that Tomcat, with its leading presence in the live eventmarket, especially in the United States, and its high quality brand image, is ahighly complementary fit with our existing European based staging structuresbusiness, Litec. With the additional benefits of shared sourcing in Europe, theacquisition has the potential to accelerate growth and generate attractivereturns for the Group's shareholders. We look forward to working with Tomcat inthe future." Information on Tomcat Tomcat Global comprises Tomcat and Brilliant Stages. Tomcat was founded in 1987by its current owner, Mitch Clark, who will continue with the business. Today ithas over 140 employees at sites in Midland, Texas with additional operations inMexico and in the UK supplying both premium standard and custom aluminium trusssystems, principally for the entertainment and exhibition industries. BrilliantStages, based in the UK, is a leading supplier of custom effects and accessoriesfor staged events. Tomcat and Brilliant Stages have undertaken projects for awide variety of live events for customers such as the Rolling Stones, PinkFloyd, Robbie Williams and U2. For more information, see www.tomcatglobal.com In the year ended 31 December 2005 Tomcat generated adjusted consolidated profitbefore tax of US$2.1 million (£1.1 million). Gross assets as at 31 December2005 were US$8.8 million (£4.6 million). Summary terms of the Acquisition Under the terms of the acquisition agreement, Vitec has acquired the shares ofTomcat Global for an initial net cash consideration of US$14.5 million (£7.6million) subject to any closing balance sheet adjustments. Deferred cash consideration of up to a maximum of US$8.3 million (£4.4 million)is also payable on the achievement of certain annual profitability targets for2007-09. Additional consideration of up to $5.5 million (£2.9 million) will onlybecome payable if profit before interest and tax in the year ending 31 December2008 for Tomcat (excluding Brilliant Stages) exceeds $2.2 million (£1.2million). Additional consideration of up to £1.5 million will only becomepayable if profit before interest and tax in the year ending 31 December 2009for Brilliant Stages exceeds £0.75 million. Analysts conference call Vitec will be hosting a conference call for analysts at 10.00am today. For dialin details please contact Elaine Ryman at Financial Dynamics on 020 7269 7121. -Ends- Contacts: The Vitec Group plc Telephone: 020 8939 4650Gareth Rhys Williams, Chief ExecutiveAlastair Hewgill, Finance Director Financial DynamicsRichard Mountain / Susanne Walker Telephone: 020 7269 7121 Notes to Editors About The Vitec Group plc The Vitec Group plc supplies a wide range of equipment and services to thebroadcasting, entertainment and photographic industries. Its products aredistributed in nearly 100 countries, either through dealerships or direct to theend user or corporate customer. The Vitec Group is a major force in its chosenspecialised fields. More information can be found at: http://www.vitecgroup.com. Notes 1. This statement should not be taken to mean that earnings per share (preamortisation of intangibles) of The Vitec Group plc will necessarily exceedhistoric earnings per share (pre amortisation of intangibles) of The Vitec Groupplc and no forecast is intended or implied. 2. Statements made in this announcement that look forward in time or thatexpress management's beliefs, expectations or estimates regarding futureoccurrences are "forward-looking statements" within the meaning of the UnitedStates federal securities laws. These forward-looking statements reflect Vitec'scurrent expectations concerning future events and actual results may differmaterially from current expectations or historical results. 3. All values in pounds sterling have been calculated using the exchange rate:£ 1: 1.90 US$ This information is provided by RNS The company news service from the London Stock Exchange