Embargoed until 07.00 on:
Monday 19 March 2018
Volution Group plc
Acquisition of Simx Limited
Volution Group plc ("Volution" or "the Group", LSE: FAN), a leading supplier of ventilation products to the residential and commercial construction markets, is pleased to announce that it has acquired Simx Limited ("Simx") for an all cash consideration of NZ$72.0 million (approximately £37.8 million). Simx is the leading designer, manufacturer and supplier of primarily residential ventilation products to the New Zealand heating, ventilation and air-conditioning market. It is headquartered in Auckland, New Zealand, with an additional distribution centre in Christchurch, New Zealand.
Strategic and Financial Overview
Simx was established in 1983 and has been a customer of Volution for over 20 years. It has developed into the leading residential ventilation product provider in the New Zealand market and we are excited about integrating the company into the Group and further developing its product portfolio. A significant part of Simx's revenue in the financial year ended 30 June 2017 was third party sourced fans sold under the Group's Manrose brand. Simx also sells a number of its own market leading brands including SmartVent, Heat Trans and Simx.
The acquisition of Simx is in line with the Group's strategy to grow by selectively acquiring value-adding businesses in new markets and geographies across the residential ventilation market and, where appropriate, in the commercial ventilation market.
The acquisition was on a debt free, cash free basis for an all cash consideration of NZ$72.0 million (approximately £37.8 million), funded from the Group's existing cash and banking facilities. During the financial year ended 30 June 2017, Simx generated revenue of NZ$36.6 million (approximately £19.2 million). Reported profit before tax was NZ$4.6 million (approximately £2.4 million) and reported profit before interest and tax was NZ$6.1 million (approximately £3.2 million). Simx's gross assets were NZ$25.3 million (approximately £13.3 million) as at 30 June 2017.
Volution expects the acquisition to be immediately earnings enhancing in the year ending 31 July 2018 and will be reported under Volution's Ventilation Group division.
The three Executive Directors, who were also the shareholders, together with the sole Non-Executive Director on the board, stepped down from their roles on completion of the transaction and have left the business. As part of this transaction, Ian Borley, who has been General Manager at Simx since 2009, has been appointed Managing Director. Lee Nurse, who has been with Volution for 9 years and is currently the Group Product & Marketing Director, will assist with the integration of Simx into the Group.
The combination of Ian Borley's knowledge and experience, supported by the strong existing operational management team, together with Lee Nurse's wider understanding of the Group and his involvement with integrating previous acquisitions, creates the right management platform to underpin our ambitious plans for further growth of the business.
Commenting on the acquisition, Ronnie George, Chief Executive Officer of Volution, said:
"We are delighted to have reached agreement to acquire Simx, a trading partner of Volution for over 20 years and one of the first overseas partners that I met when I joined Volution in 2008. In that time, it has developed into the leading residential ventilation product provider in the New Zealand market. This acquisition is consistent with our stated strategy of making selective value enhancing acquisitions in new markets where a business has a leading market position. We are excited about further developing Simx, in particular, by introducing more energy efficient and aesthetically more attractive products to their portfolio, and we believe the acquisition will deliver an attractive return for our shareholders."
-Ends-
For further information please contact:
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Volution Group plc |
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Ronnie George, Chief Executive Officer |
+44 (0) 1293 441501 |
Ian Dew, Chief Financial Officer |
+44 (0) 1293 441536 |
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Tulchan Communications |
+44 (0) 207 353 4200 |
James Macey White |
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David Ison |
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Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No. 596/2014) prior to its release as part of this announcement.
Legal Entity Identifier: 213800EPT84EQCDHO768.
Note to Editors:
Volution Group plc (LSE: FAN) is a leading supplier of ventilation products to the residential and commercial construction markets in the UK, the Nordics, Central Europe and Australasia.
The Volution Group operates through two divisions: the Ventilation Group and the OEM (Torin-Sifan) division. The Ventilation Group consists of 14 key brands - Vent-Axia, Manrose, Diffusion, National Ventilation, Airtech, Breathing Buildings, Fresh, PAX, VoltAir, Welair, inVENTer, Brüggemann, Ventilair and Simx focused primarily on the UK, the Nordic, Central European and Australasian ventilation markets. The Ventilation Group principally supplies ventilation products for residential and commercial ventilation applications. The OEM (Torin-Sifan) division supplies motors, fans and blowers to OEMs of heating and ventilation products for both residential and commercial construction applications in Europe.
Cautionary statement regarding forward-looking statements
This document may contain forward-looking statements which are made in good faith and are based on current expectations or beliefs, as well as assumptions about future events. You can sometimes, but not always, identify these statements by the use of a date in the future or such words as "will", "anticipate", "estimate", "expect", "project", "intend", "plan", "should", "may", "assume" and other similar words. By their nature, forward-looking statements are inherently predictive and speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. You should not place undue reliance on these forward-looking statements, which are not a guarantee of future performance and are subject to factors that could cause our actual results to differ materially from those expressed or implied by these statements. The Company undertakes no obligation to update any forward-looking statements contained in this document, whether as a result of new information, future events or otherwise.
