3rd Apr 2024 12:43
(Alliance News) - AB Dynamics PLC on Wednesday expanded its presence in the US with the acquisition of Venshure Test Services LLC.
Shares in AB Dynamics rose 2.5% to 1,732.00 pence in London early Wednesday afternoon.
The Wiltshire-based designer, manufacturer and supplier of advanced testing, simulation and measurement products serving the transport market said it will pay up to USD30.0 million (around GBP23.6 million) for VTS.
This includes an initial cash payment of USD15.0 million, with a further USD15.0 million payable across two tranches for the two years following completion, subject to meeting certain performance criteria.
AB Dynamics said the deal would be funded from existing cash resources and short-term utilisation of part of the group's revolving credit facility.
The purchase is expected to be earnings enhancing in 2024, with revenue for the 5-month period forecast to be around USD1.8 million and and adjusted operating profit of around USD700,000.
VTS is a Michigan-based provider of dynamometer-based testing services to the automotive sector in the US, particularly focussed on the development and deployment of electric vehicles for US based automotive original equipment manufacturers.
In 2023, VTS generated revenue of USD3.5 million, earnings before interest, tax, depreciation and amortisation of USD1.9 million and adjusted operating profit of USD1.5 million.
By Jeremy Cutler, Alliance News reporter
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