8 Feb 2010 07:01
ACQUISITION OF AL-MET LIMITED
Pressure Technologies plc ("Pressure Technologies" or the "Group) is pleased to announce the acquisition of Al-Met Limited ("Al-Met" or the "business"), a niche manufacturer of specialised, precision engineered valve wear parts used in the oil and gas industries.
Al-Met's products are used in high-pressure choke and flow control valves, designed to regulate flow volumes in extremely demanding applications in the subsea and surface oil and gas industries. The business, which was established in 1985, has developed a leading edge capability in precision machining carbides and superalloy matrix materials. The ability to combine high alloy steels with tungsten carbide inserts and specialised coatings gives Al-Met its niche position with its customers, global wellhead and subsea equipment OEMs.
The business is well invested with a quality range of CNC turning, milling and grinding equipment. It is based at a single production site in Pontyclun, near Cardiff, and employs 29 staff, including 20 highly-trained machinists. The director and general manager, Tony Chess, along with his management team, will remain with the business following the acquisition.
Al-Met has been acquired for cash consideration of up to £2.25m. The initial consideration of £2.0m is subject to an adjustment based on net assets at completion. Contingent consideration of £0.25m, which will become payable depending on Al-Met's order intake level in the 12 month period to 31 December 2010, has also been placed in an escrow account.
The maximum total cash consideration payable, including the initial cash consideration, net asset adjustment and contingent consideration, is £2.25m. Any net asset adjustment would only reduce this amount.
Unaudited management accounts for Al-Met for the 12 months ended 31 December 2009 show turnover of £4.2m, adjusted operating profits of £0.3m, adjusted EBITDA of £0.5m and gross assets of £2.0m. The initial cash consideration, net of £0.25m of cash acquired as part of the deal, represents a multiple of 3.5 times unaudited historical adjusted EBITDA.
John Hayward, Chief Executive of Pressure Technologies, said: "Al-Met is an established, well invested, niche business, operating in a sector we know and understand. The highly skilled workforce and the focus on design and quality fit well culturally with our other businesses. This is an exciting acquisition for the Group as there is a clear opportunity to grow the business organically by expanding both the customer base and the product portfolio."
For further information, please contact:
| Pressure Technologies plc John Hayward, Chief Executive James Lister, Group Finance Director
| Today: 01653 618 016 Thereafter: 0114 242 7500 www.pressuretechnologies.co.uk |
| Rawlings Financial PR Limited Catriona Valentine Keeley Clarke
| Tel: 01653 618 016 www.rawlingsfinancial.co.uk |
| Fairfax IS PLC Nominated Adviser and Broker Simon Bennett Ewan Leggat
| Tel: 0207 598 5368 |
Company description:
Pressure Technologies is the holding company for Chesterfield Special Cylinders Limited ("CSC"). CSC designs, manufactures and offers retesting and refurbishment services for a range of speciality high-pressure, seamless steel gas cylinders for global energy and defence markets. The business has been conducted under the "Chesterfield" brand which is a long established name in the cylinders and specialised pressure vessel market.
Chesterfield BioGas ("CBG"), an operating division of Pressure Technologies, formed in November 2008 following the signing of a co-operation agreement with Greenlane® Biogas Limited, the world leader in biogas upgrading from raw biogas to vehicle quality fuel, gives Pressure Technologies exclusive rights to market Greenlane® equipment in the UK and Eire. Chesterfield BioGas will provide turnkey solutions for the cleaning, storage and dispensing of biomethane, produced from waste water treatment and anaerobic digestion of organic waste.
Pressure Tech (PRES)