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Carr's Group acquires NuVision Engineering, Inc.

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By LSE RNS

RNS Number : 1620N
Carr's Group PLC
07 August 2017
 

7 August 2017

 

 

 

Carr's Group plc

"Carr's" or the "Group"

 

Carr's Group acquires NuVision Engineering, Inc.

 

 

7 August: Carr's Group plc, the Agriculture and Engineering group, is pleased to announce it has acquired 100% of ESI Holding Company, Inc., the holding company of USA based engineering company NuVision Engineering, Inc. ("NuVision"), for an initial cash consideration of $11.5m (£8.8m) and a total cash consideration of up to $20m (£15.4m) dependent on future financial performance.  The initial consideration will be financed through a combination of new and existing debt facilities, and the contingent consideration will be financed from NuVision's future retained earnings.

 

NuVision, founded in 1971 and headquartered in Pittsburgh, Pennsylvania with operations in Charlotte, North Carolina, is a leading technology and applications engineering company focussed on providing value in commercial nuclear and power plant facilities, government waste remediation facilities and waste clean-up.  Its customers include the USA Department of Energy, major nuclear energy suppliers, public utilities, and international governments.  NuVision is also a 49% minority shareholder in Mid Columbia Engineering, Inc. ("MCE"), an engineering company based in Richland, Washington and local to the Hanford Site nuclear complex.

 

NuVision's specialist technologies and activities undertaken include:

 

·     MSIP®: a patented technology to improve nuclear safety and prolong operational life through crack

         mitigation in power plant welds;

·     Power Fluidics™: maintenance free systems for mixing, sampling, and retrieving

         hazardous/radioactive liquids, slurries and sludge;

·     Decontamination: efficient and effective systems for decontaminating pipe-ends and other artefacts

         in nuclear power plants during standard maintenance procedures;

·     Robotics: a suite of heavy duty manipulators for use in clean-up operations, complementing the range

         currently offered by the Group's existing remote handling operations; and

·     R&D consultancy: working with the USA Department of Energy to develop innovative solutions for the

         nuclear industry.

 

Strategic rationale

 

The acquisition provides a strong foothold into the main nuclear markets in the USA and will enable revenue synergies with the Group's existing nuclear engineering businesses, including the opportunity to market Wälischmiller's products in the USA.  It will also extend the Group's service capability in the nuclear market due to the complementary nature of NuVision's product range.  NuVision will also act as a key supplier under a major nuclear contract signed on 20 July 2017 and being delivered by our UK Manufacturing business in the next financial year.

 

It is in line with the Group's stated strategy of growing our international footprint, focussing on growth markets with significant potential and to be at the forefront of innovation and technology.

 

 

Highlights of the acquisition

 

·        USA presence for the wider engineering division providing access into the main nuclear markets in the USA

·        Provide the group with specialised IP

·        Extensive contract and opportunity pipeline

·        Innovative technology

·        Revenue synergies with Bendalls / Wälischmiller and complementary products to our existing manipulator business

·        Experienced senior management team to remain with the business, integrating their knowledge and relationships in the USA nuclear market into the existing engineering division

 

 

For the year ended 31 March 2017, the company generated revenue of $8.8m and proforma EBITDA and profit before tax adjusted to exclude non-recurring items and amortisation of intangibles was $2.3m and $1.1m.  Reported profit before tax for the year was $0.2m (after non-recurring items of $0.6m, amortisation of intangible assets of $0.3m, and depreciation of revalued assets of $0.8m), and gross assets at 31 March 2017 were $12.5m.

 

Total consideration is up to a maximum of $20m, on a cash/debt free basis, with an initial consideration payable in cash of $11.5m (before adjustments for working capital and net debt).  The remaining $8.5m will be payable in cash contingent on delivering a certain level of EBITDA performance post acquisition over the 32 month period to 31 March 2020.  The initial consideration is being funded through £6m of new term loan facilities, and use of the Group's existing undrawn revolving credit facilities.

 

Commenting on the acquisition, Tim Davies, CEO, said:

 

"I am delighted to announce the acquisition of NuVision Engineering, Inc. This acquisition lays the foundations for growth into the USA and wider international nuclear markets and provides us with access to specialised IP and a strong pipeline of long term contract opportunities. Additionally, this presents a significant opportunity for us to expand our existing remote handling operations into the USA market.

 

"The management team at NuVision have created long lasting and sustained relationships with a number of major nuclear customers and we look forward to building on this and continuing to invest in the business and the team."

 

Also commenting on the acquisition, Van Walker, President and CEO of NuVision, said:

 

"I am very excited about the prospect of NuVision Engineering becoming part of Carr's Group.  The acquisition will enable the two companies to work seamlessly in providing value adding engineering services to the USA and wider global nuclear markets."

 

 

Enquiries:

 

Carr's Group plc
Tim Davies (Chief Executive)
Neil Austin (Group Finance Director)

Tel: +44 (0) 1228 554 600

 

 

Powerscourt
Nick Dibden / Lisa Kavanagh

Tel: +44 (0) 20 7250 1446

 

 

About Carr's Group plc:

 

Carr's is an international leader in manufacturing value added products and solutions, with market leading brands and robust market positions in Agriculture and Engineering, supplying customers in 35 countries around the world.

 

Its Agriculture division manufactures and supplies feed blocks for livestock, farm machinery and runs a UK network of rural stores, providing a one-stop shop for the farming community. Its Engineering division designs and manufactures bespoke equipment for use in the nuclear, petrochemical, oil and gas, pharmaceutical, process and renewable energy industries, including robotic and remote handling equipment.

 

Nothing in this announcement is intended to be a profit forecast and this statement should not be interpreted to mean that the future profitability of the Group will necessarily match or exceed the historical published earnings of either Carr's or NuVision.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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