5th Sep 2006 07:02
Judges Capital PLC05 September 2006 JUDGES CAPITAL EXPANDS VIA FIRE TESTING TECHNOLOGY'S ACQUISITION OF AITCHEE ENGINEERING 5 SEPTEMBER 2006 The Board of Judges Capital plc ("Judges" or "the Company") announces that FireTesting Technology ("FTT"), a wholly owned subsidiary of the Company, hasacquired the business and assets of Aitchee Engineering Associates ("Aitchee" or"the Business") for a maximum cash consideration of £230,000. Aitchee, which specialises in the manufacture of engineering parts and finishedproducts, has been a key sub-contractor of FTT which is the Business's largestcustomer. The Directors of Judges expect this transaction to increase FTT'soperating flexibility, secure supplies and enhance EBITA with immediate effect. Aitchee, formed by Hugh and Eunice Evans in 1971, is unincorporated and operatesout of premises owned by Mr and Mrs Evans in Limpsfield, Surrey. The Businesswill continue to operate out of these premises in the short term although theintention is to relocate to a site close to FTT's premises in East Grinstead,West Sussex. In the year to 31 July 2006 the Business is estimated to have generatedunaudited profits of £150,000 from sales of £510,000, which included sales ofmore than £100,000 to FTT. Such profits are before rent and remuneration which,had the business been incorporated, might otherwise have been paid to theowners. Total expenditure by FTT in respect of the type of products it purchasesfrom Aitchee and other sources amounts to approximately £230,000 per annum. FTT, through a new subsidiary, Aitchee Engineering Ltd, will purchase machineryand stock having a book value of approximately £7,000. The consideration payable to Mr and Mrs Evans amounts to £220,000, of which£200,000 is due at completion, with a further £20,000 payable after a year. Inaddition, an earn-out not exceeding £10,000 will be payable, subject to sales tothird parties during the year to 31 July 2007 exceeding sales to third partiesin the preceding financial year. The maximum purchase price of £230,000 will befunded from Judges' existing cash balances. The majority of the purchase price represents goodwill which Judges intends toamortise over three years. Although the Directors of Judges expect theacquisition to enhance earnings per share (before amortisation) with immediateeffect, the full benefits will not become apparent until 2008 in view of thefact that the 2007 accounts will reflect the costs of the intended relocation. Ends For further information please contact: David Barnbrook, Managing Director FTT: Tel: 01342 323600Mike Sawbridge, Shore Capital & Corporate: Tel: 0151 600 3722Melvyn Marckus, Cardew Group: Tel: 0207 930 0777 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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