17th Sep 2007 07:01
Hargreaves Services PLC17 September 2007 For immediate release 17 September 2007 HARGREAVES SERVICES PLC ("Hargreaves") Acquisition of Imperial Tankers Limited - Maximum Consideration £7 million Hargreaves announces the acquisition of Imperial Tankers Limited ("Imperial") acompany engaged in the movement of liquid products, similar to those transportedby Hargreaves Bulk Liquid Transport Limited ("HBLT"). Together, the mergedbusinesses will be a top 5 player in the UK chemical tanker sector. Hargreaves is paying an initial consideration of £5.0 million in cash, to befunded from existing resources. There is also an earnout of up to £2.0 millionpayable in cash based on the performance of the combined businesses of HBLT andImperial in the first year following completion. Payment of the fullconsideration will result in a PE multiple of 7 times current year earnings.The directors of Hargreaves believe that the acquisition will be immediatelyearnings enhancing. Imperial was a MBO from ICI approximately 10 years ago, since when it has grownsubstantially. Around 80 per cent of its volumes are contracted for periods ofbetween one and five years. Key customers include Terra Nitrogen, UK Bitumen,Petroplus and Koppers. Hargreaves plans to integrate Imperial with HBLT. Bothbusinesses operate in a very attractive sector within transport with a highfocus on health and safety leading to higher margins. In the last financial year, Imperial achieved a profit before tax of £1.35million on sales of £16.1 million. Warranted net assets at completion are £3.0million. Note: Nothing in this announcement should be construed as a profit forecast orbe interpreted to mean that the future earnings per share or profits ofHargreaves will necessarily be greater than the historic published earnings pershare. Commenting on the acquisition of Imperial, Hargreaves' Chief Executive Officer,Gordon Banham said:- "Imperial is an excellent and well-run chemical tanker business which is also aperfect fit with our own business, HBLT. The integration of the 2 businesseswill start immediately and will result in significant synergies and savings. Weview the growth potential of the combined chemical tanker operations as veryencouraging". Enquiries: Hargreaves Services 0191 373 4485Gordon Banham, CEOPeter Dillon, Financial Director Buchanan Communications 0207 466 5000Tim Anderson Brewin Dolphin 0113 244 0130Andrew Kitchingman This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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