APC Technology Group PLC Acquisition of EuroTech (Export) (8883B)

TIDMAPC

RNS Number : 8883B

APC Technology Group PLC

12 June 2019

12 June 2019

APC Technology Group PLC

("APC" or the "Company" or the "Group")

Acquisition of Euro-Tech (Export) Limited

APC Technology Group PLC (AIM: APC), the provider of design-in, specification and distribution services for specialist electronic components and systems, lighting technologies and connectivity products, is pleased to report that it has completed the acquisition of Euro-Tech (Export) Limited ("Euro-Tech"), a distributor and international reseller of electronic components.

Euro-Tech sources and supplies a wide range of active, passive and electromechanical components, industrial products and consumables from major global manufacturers and quality assured sources across Europe to blue chip OEM and CEM customers around the world.

Euro-Tech's products and services are complementary to APC's Locator business and will significantly enhance APC's capability in the sourcing of hard to find or obsolete and end of life components, products and systems. The previous owners and founders of Euro-Tech, Chris Smallwood and Phil Hutchins, will continue to work within the business, reporting to APC's Chief Executive, Richard Hodgson. Chris will assist with integrating the business for a period of time before retiring, while Phil will continue in his role as Sales & Marketing Director, driving the business's sales growth across the enlarged Group.

For the 12-month period ended 30 April 2019, Euro-Tech's unaudited results will record revenues of GBP2.2m, gross profit of GBP0.75m, an adjusted EBITDA of GBP0.2m, a profit after tax of GBP0.1m and net assets of cGBP0.6m. It is expected that its profitability will increase following integration into the Group's business with the realisation of potential efficiency and revenue synergies.

The consideration payable will be GBP1.05m of which GBP0.165m represents cash at completion in Euro-Tech and GBP0.14m is derived from excess working capital. 50% of the purchase consideration is payable on completion, 25% in monthly instalments over twelve months and 25% twelve months after completion. The Euro-Tech balance sheet at completion includes GBP0.35m of trade debtors, which will be rolled into the APC invoice finance facility with ABN and hence the transaction will be funded through the Group's existing financing facilities.

Richard Hodgson, CEO of APC Technology Group, commented:

"As we reported in our recent interim results, our strategy is built on three main growth drivers: growth through increased bookings from our existing technologies; growth through the signing of new complementary product lines; and growth through targeted bolt-on acquisitions.

With regard to the third strand of that strategy, the purchase of Euro-Tech is our fourth acquisition in 18 months and I am delighted to welcome Chris, Phil and the Euro-Tech team to APC. Combining Euro-Tech's capabilities alongside our APC Locator business will provide a significant boost to our offering in the growing market for the sourcing of hard to find and obsolete electronic components and products. It will also provide us with opportunities to sell our UK business into a broader customer base and provide our other international franchises with opportunities in a wider global marketplace."

Enquiries:

APC Technology Group PLC [phone]

Richard Hodgson, Chief Executive www.apcplc.com

Shore Capital (Nominated Adviser and Broker) [phone]

Mark Brown / Antonio Bossi

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June 12, 2019 02:00 ET (06:00 GMT)