24th Dec 2007 07:01
AssetCo PLC24 December 2007 For immediate release 24 December 2007 AssetCo plc ("AssetCo" and or the "Company") Acquisitions of TVAC - The Vehicle Application Centre Limited ("TVAC") and UV Modular Limited ("UVM") AssetCo plc, (AIM : ASTO) a leading provider of support services to the UK Fireand Rescue Service, is pleased to announce that it has acquired the issuedshare capital of TVAC, an established provider of engineering solutions to, inter alia, the UK Fire and Rescue Service and UVM, a leading designer andmanufacturer of ambulances for the emergency and local authority sectors. Theconsideration payable for TVAC is an initial amount of GBP2.08million comprisingGBP780,000 in cash and GBP1.3 million in AssetCo plc shares together withpotential deferred consideration of up to GBP6.87 million. The considerationpayable for UVM is an initial amount of GBP700,000 in cash with potentialdeferred consideration of up to GBP800,000. TVAC TVAC is a leading manufacturer of a full range of fire engineered equipment,vehicle appliances and vehicle conversions to, inter alia, the UK Fire andRescue Service. As one of the most professional, innovative and R&D focused manufacturers, the company is the UK franchise holder for Plastisol, thepreferred fire appliance body in the UK, and has been involved in the build ofvehicles for the majority of Fire and Rescue Authorities in the country. Aswell as assembling fire appliances, TVAC has a long and successful tri-partitedevelopment partnership with AssetCo and the London Fire and Emergency PlanningAuthority to supply the most advanced fire appliances to the London FireBrigade. The acquisition will bring a complementary set of technologies andexpertise to enhance the design, engineering and build capability offered bythe Group's Papworth Specialist Vehicles subsidiary. This acquisition will make AssetCo the largest provider of fire appliances tothe UK Fire and Rescue market and leaves the Company well positioned to takeadvantage of the growth anticipated in a number of overseas markets. TheDirectors expect the transaction to be earnings enhancing in the first fullfinancial year of ownership. In the year ended 31 August 2007, TVAC reported PBT of GBP625,000 on turnover ofGBP18.4 million and had net liabilities of GBP1.38 million. Under the terms of the share purchase agreement, AssetCo (through its subsidiaryentity, AssetCo Specialist Vehicles Limited ("AssetCo Specialist Vehicles" orthe "Purchaser")) has acquired the entire issued share capital of TVAC for consideration comprising: - an initial consideration of GBP2.08 million which is to be satisfied as to GBP780,000 in cash and as to GBP1.3 million in shares by the issue of 724,233 new ordinary shares in AssetCo at 179.5 pence - a deferred payment of up to GBP6.87 million in cash, in part dependent upon the trading performance of the specialist vehicles division of AssetCo (of which TVAC will form a part). Up to GBP2.87m may be payable on 31 May 2009 with the balance potentially payable by 31 May 2010. Application will be made for the new ordinary shares to be admitted to tradingon AIM. The new ordinary shares will rank pari passu with the existing ordinaryshares of the Company. UVM UVM is the UK's largest specialist designer and manufacturer of ambulances forthe emergency and local authority sectors.. Since its formation in 2002, UVM hasachieved a strong reputation for the build quality of its vehicles and gained asignificant share of the market for box conversion ambulances in the UK. Inaddition to manufacturing ambulances, UVM also builds mobility vehiclesprimarily for delivery to UK local authorities. Two types of coach builtambulances are sold by UVM: the modular (aluminium) and the premia (fibreglass).In addition, UVM also supplies a small number of van conversion ambulances and"hybrid" ambulances (a cross between a patient transit services vehicle and anambulance). Combining UVM with AssetCo's existing ambulance conversion expertise, capacityand state of the art CAD/CAM systems at Papworth Specialist Vehicles willconsolidate UVM's position as the largest provider of ambulances to the UK andwill deliver economies of scale and offer the market greater choice of design,build, conversion, and assembly options from one, dedicated supplier. UVM is currently a loss making business; however the Directors expect toestablish a break even position during the first full year of ownership. In the year ended 30 June 2007, UVM reported a loss before tax of GBP1.5 millionon turnover of GBP26.2 million and had net liabilities of GBP2.1 million. AssetCo Specialist Vehicles has acquired the entire ordinary share capital ofUVM for a total consideration of up to GBP1.5 million, comprising GBP700,000 incash payable at completion and a maximum deferred cash consideration of GBP800,000 to be paid in accordance with a gross profit based earn-outagreement. John Shannon, Chief Executive Officer, commented: "We are pleased to announce these two acquisitions, both of which help usdeliver additional engineering solutions to not only the UK Fire and RescueService, but also extend our supply reach into the UK Ambulance Service. This isconsistent with our stated strategy of establishing a more stable and securesupply chain to our core Fire & Rescue Service market and also expanding ouroperation beyond the UK Fire and Rescue Service, into the NHS market where ourmanaged service offering is receiving increasing interest. These acquisitions will allow the scale, innovation and reputation of TVAC andUVM to be combined with the capacity and state of the art design andmanufacturing systems already offered by AssetCo. It is our aim to build onthese unique strengths to develop a recognized centre of excellence for theemergency services. This will provide them with wider choice, greaterinnovation, and a more robust, financially secure, supply chain when choosingwhere to place their major investment programmes. This is an issue of long termconcern for public sector clients. We continue to evolve our overall offering to the emergency services and arepleased to have recently completed these important synergistic acquisitions." For more information please contact: AssetCo plc Tel: +44 (0) 20 8515 3999John ShannonFrank Flynn Hoare Govett Limited Tel: +44 (0) 20 7678 8000Stephen BowlerJohn MacGowanRichard Crichton Buchanan Communications Tel: +44 (0) 20 7466 5000Tim AndersonIsabel Podda This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Assetco