Gooch & Housego PLC Two acquisitions in the Aerospace & Defence sector (7482D)
11 July 2016 - 7:00AM
UK Regulatory
TIDMGHH
RNS Number : 7482D
Gooch & Housego PLC
11 July 2016
For immediate release 11 July 2016
Gooch & Housego PLC
("G&H" or the "Company")
Two acquisitions in the Aerospace & Defence sector
Gooch & Housego PLC (AIM: GHH), the specialist manufacturer
of optical components & systems, announces that it has
completed two acquisitions that expand the Company's presence in
the Aerospace & Defence sector.
Kent Periscopes
G&H has acquired the entire issued share capital of Kent
Periscopes Ltd ("Kent"), a UK based specialist supplier of
periscopes, vehicle sights and related equipment for land based
Armoured Fighting Vehicles (AFVs).
Kent was founded in 2005 and has established itself as a market
leading key supplier on major vehicle programmes to blue-chip
military manufacturers. It is based in St Asaph, North Wales, owns
key intellectual property and has capabilities in product design,
assembly and sales and marketing. Kent also has a well established
and cost-effective supply chain, which includes the option to
outsource sub-assembly and complete 'end-product' production.
Kent has a proven capability in providing system level optical
products for use in harsh environments to an impressive
international customer list. It has a strong market position and a
committed, long-term order book in excess of GBP20 million, which
helps to underpin future revenues.
The acquisition of Kent is aligned with G&H's strategic
objectives of moving up the value chain and further diversification
in the Aerospace & Defence sector. Potential synergies include
leveraging G&H's greater global reach through our sales and
business development teams and taking advantage of our expertise in
precision optics and specialist coatings.
The consideration payable by G&H will be up to GBP9.5
million, net of cash remaining in the business. This comprises
GBP7.0 million initial cash consideration, funded from existing
cash and debt facilities, paid on completion and a deferred
contingent consideration of up to GBP2.5 million, payable in cash
and a small number of shares, based upon the performance of the
business over the next two years.
Alfalight
G&H has also acquired the trade and assets of Alfalight Inc
("Alfalight"), a Madison, Wisconsin based designer and manufacturer
of high reliability, laser based, electro-optic systems for defence
and security applications.
Founded in 1999, Alfalight has established itself as an expert
in diode and diode pumped solid state lasers and is designed into a
number of long-term contracts for the defence sector in the USA.
Alfalight is highly complementary to G&H's existing Boston,
Massachusetts, business and will be incorporated into this business
unit. G&H will benefit from this acquisition through its deep
ties with key defence customers, which will further the Company's
strategic objective of diversification into the Aerospace &
Defence sector.
The gross consideration paid by G&H was $1.3 million, in
cash, funded from existing cash and debt facilities at
completion.
Summary financial effects
The historic combined annual revenue of the two companies is
circa GBP9 million. Both acquisitions are expected to be earnings
enhancing in the first full year of ownership.
Mark Webster, Chief Executive Officer of Gooch & Housego,
commented:
"These acquisitions meet our strategic aims of moving up the
value chain and diversification through increasing our footprint in
the Aerospace & Defence sector.
"Kent is a well established business with an impressive list of
international blue chip customers. We believe that G&H will
enable this business to fulfil its true potential through
leveraging our greater global reach and our complementary
technological capabilities.
"Alfalight's expertise in diode lasers in the US defence sector
is an excellent fit for our Boston business and will enable it to
establish a critical mass in this marketplace.
"We are very much looking forward to working with the
management, staff and customers of both companies."
For further information
contact: -
Mark Webster / Andrew Gooch & Housego
Boteler PLC 01460 256440
Mark Court/ Sophie
Cowles Buchanan 020 7466 5000
Patrick Robb / David Investec Bank
Anderson plc 020 7597 5970
Notes to editors
1. Gooch & Housego is a photonics technology business
headquartered in Ilminster, Somerset, UK with operations in the USA
and Europe. A world leader in its field, the company researches,
designs, engineers and manufactures advanced photonic systems,
components and instrumentation for applications in the Aerospace
& Defence, Industrial, Life Sciences and Scientific Research
sectors. World leading design, development and manufacturing
expertise is offered across a broad range of complementary
technologies.
2. All financial information included in this announcement is
sourced from unaudited management accounts and excludes any
specific items. This announcement contains certain forward-looking
statements that are based on management's current expectations or
beliefs as well as assumptions about future events. These are
subject to risk factors associated with, amongst other things, the
economic and business circumstances occurring from time to time in
the countries and sectors in which G&H operates. It is believed
that the expectations reflected in these statements are reasonable
but they may be affected by a wide range of variables which could
cause actual results, and G&H's plans and objectives, to differ
materially from those currently anticipated or implied in the
forward-looking statements. Investors should not place undue
reliance on any such statements. Nothing in this announcement
should be construed as a profit forecast.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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