24th Dec 2019 07:34
(Alliance News) - FTSE 250-listed Bodycote PLC on Tuesday said it has agreed to buy North America-based Ellison Surface Technologies for a gross consideration of USD200 million.
The transaction is expected to complete during the first quarter of 2020.
Bodycote said the deal is expected to create "one of the world's largest" providers of thermal spray and engineered coating surface technology services to the aerospace industry. Ellison will be integrated into Bodycote's surface technology and aerospace business.
The Macclesfield-headquartered heat treatment and thermal processing services provider said the consideration will be settled using its existing committed credit facilities.
Ellison's business generated revenue of USD50 million in 2018, Bodycote said, with associated pro-forma earnings before interest, taxes, depreciation, and amortization of USD8 million.
Based on results year to date, Bodycote said it anticipates that Ellison's revenue for 2019 will be USD58 million with pro-forma Ebitda of USD12 million. The expectation of 16% revenue growth is boosted by the fact that Ellison has been gaining share in the civil aviation business, Bodycote said.
"Ellison's business is one that we have long respected and is a perfect strategic fit for Bodycote's aerospace and Specialist Technologies' businesses. Ellison has been successful in winning new business in recent years and it will be very complementary to Bodycote's existing Surface Technology business," said Bodycote Chief Executive Stephen Harris.
By Evelina Grecenko; [email protected]
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