TIDMSDI
RNS Number : 7088X
SDI Group PLC
07 January 2022
SDI Group plc
("SDI", "SDI Group", the "Company" or the "Group")
(AIM: SDI)
Acquisition of Scientific Vacuum Systems Ltd and
Further Atik Cameras Order
SDI Group plc, the AIM quoted Group focused on the design and
manufacture of scientific and technology products for use in
digital imaging and sensing control applications, is pleased to
announce the acquisition on 05 January 2022 of Scientific Vacuum
Systems Ltd ("SVS"), a UK manufacturer of physical vapour
deposition equipment (the "Acquisition"). Total consideration,
including earnout, is forecast to be approximately GBP4.9 million,
net of cash acquired.
Highlights:
-- SVS specialises in custom Physical Vapour Deposition (PVD) systems for the deposition of thin film
coatings
typically on semiconductor wafers, for use in scientific research, industrial and semiconductor
manufacturing
applications
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-- SVS are market leaders in the manufacture of production sputter coaters for premium brand razor blade
coating
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-- Revenues for the year to September 2021 were approximately GBP2.5m and EBIT of GBP0.7 million
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-- Acquisition expected to be immediately earnings enhancing
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Ken Ford, Chairman of SDI said: "The acquisition of SVS is a
further step in our Group growth strategy and will reside within
our Sensors and Controls division. The Acquisition is expected to
be immediately earnings enhancing. We are delighted to welcome
Terry Shimell, Philip Eames and their highly technical staff to the
SDI Group."
Further Atik Cameras Order
The Company also announces that its Atik Cameras division has
received a further firm order for cameras to be used in PCR
machines, for delivery in the year ending 30 April 2023, extending
the series of orders related to the COVID-19 pandemic.
Enquiries
SDI Group plc 01223 320480
Ken Ford, Chairman
Mike Creedon, CEO
Jon Abell, CFO
www.thesdigroup.net
finnCap Ltd 020 7220 0500
Ed Frisby/Kate Bannatyne/Milesh Hindocha - Corporate Finance
Andrew Burdis/Sunila de Silva - ECM
JW Communications 07818 430877
Julia Wilson - Investor & Public Relations
About SDI Group plc:
SDI designs and manufactures scientific and technology products
for use in digital imaging and sensing and control applications
including life sciences, healthcare, astronomy, manufacturing,
precision optics and art conservation. SDI operates through its
company divisions: Atik Cameras, Synoptics, Graticules Optics,
Sentek, Astles Control Systems, Applied Thermal Control, MPB
Industries, Chell Instruments, Monmouth Scientific, Uniform
Engineering and Scientific Vacuum Systems.
SDI continues to grow by developing its own technology
advancements and by improving its global sales channels, as well as
through pursuing strategic, complementary acquisitions.
www.thesdigroup.net
The following information is in relation to the Acquisition
About Scientific Vacuum Systems Ltd
SVS specialises in the design, manufacture and service of
bespoke and standard PVD and other vacuum related systems, which
typically produce nano/micron thin films by sputtering or electron
beam evaporation onto the surface of a substrate under controlled
vacuum conditions.
Applications for such systems have included large scientific
experiments, semiconductor manufacturing, nuclear installation,
electronic component manufacture, and premium brand razor blade
manufacture where SVS enjoys good relationships with leading
manufacturers.
Additional products include Ion Beam Milling systems used in
semiconductor manufacturing and experimental photovoltaic absorber
layer deposition equipment for solar panel manufacture. SVS
typically produces a handful of high value systems each year in
addition to steady revenue from parts, consumables and service.
For the year ended 30 September 2021, SVS achieved revenues of
GBP2.5 million, and EBIT of GBP0.7 million (unaudited).
Based in Finchampstead, Berkshire, Scientific Vacuum Systems Ltd
was founded in 1990 by Terry Shimell and Philip Eames and employs
approximately 8 staff. Terry and Philip will continue to lead the
company within the SDI Group.
Acquisition rationale
The Acquisition is in line with the Group's strategy of
acquiring businesses with complementary scientific and technology
products, with capable management teams in place and with
opportunities to grow further under the SDI Group structure. The
SDI Board considers that there are long term growth drivers for
SVS's products and services.
Consideration for the Acquisition
Total consideration is estimated at GBP4.9 million, excluding
cash acquired, and consists of:
-- Initial consideration of GBP3.17 million paid in cash;
-----------------------------------------------------------------------------------------------------------------
-- A payment in cash shortly after completion, equivalent to the net tangible assets of SVS at completion,
currently
estimated at GBP1.4 million and which net tangible assets are estimated to include c.GBP0.6 million of
cash
and no bank debt (subject to completion accounts); and
-----------------------------------------------------------------------------------------------------------------
-- An earnout cash payment, payable after 30 September 2022, currently estimated at GBP0.9 million and
dependent
on the EBIT performance of SVS in the year to 30 September 2022.
-----------------------------------------------------------------------------------------------------------------
The total consideration is capped at GBP5.5 million (including
estimated GBP0.6 million of cash acquired), and this would be
payable based on Scientific Vacuum Systems achieving adjusted EBIT
for the year to 30 September 2022 in excess of GBP1.1 million.
The cash consideration will be funded from existing cash
resources and from the Group's revolving credit facility with HSBC
UK Bank. As at 31 December 2021, the Group had cash of
approximately GBP7.3 million (unaudited), bank debt of GBP3.0
million (unaudited), and GBP17.0 million of undrawn bank
facility.
No statement in this announcement is intended to be a profit
forecast or estimate and no statement in this announcement should
be interpreted to mean that earnings per share of the Company for
the current or future financial years would necessarily match or
exceed the historical published earnings per share of the
Company.
The information contained within this announcement is deemed to
constitute inside information as stipulated under the retained EU
law version of the Market Abuse Regulation (EU) No. 596/2014 (the
"UK MAR") which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018. The information is disclosed in accordance
with the Company's obligations under Article 17 of the UK MAR. Upon
the publication of this announcement, this inside information is
now considered to be in the public domain.
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END
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