6th May 2008 09:36
Hydro International PLC06 May 2008 HYDRO INTERNATIONAL PLC ACQUISITION OF EUTEK SYSTEMS, INC. Hydro International plc ("Hydro"), the leading supplier of vortex and relatedtechnologies for the control and treatment of stormwater and wastewater, ispleased to announce the acquisition of Eutek Systems, Inc. ("Eutek"). Followingthe acquisition, Eutek will form part of Hydro's US Wastewater business. Eutek is a leading provider of patented high performance equipment that removesfine grit, sugar sands, abrasives and fixed solids from wastewater streams. Theproduct range complements Hydro's own Grit King and related products and willmake Hydro the world's leading supplier of advanced vortex non-mechanical gritremoval devices to the wastewater industry. The acquisition of Eutek is for an initial cash consideration of $8.5 million.Additional consideration of 5% of revenues generated from Eutek products will bepayable for the 5 year period from 1 May 2008 to 30 April 2013. This additionalconsideration is capped at $5.0 million. The initial consideration is subject to adjustment based on the working capitalat completion following the production and agreement of completion accounts. The unaudited financial statements for the 12 months to 31 August 2007 (itscurrent year end) showed turnover of $5.3 million and adjusted* operating profitof $0.2 million. Net assets at 31 August 2007 were $0.3 million. It isestimated that Eutek's results for the year to 31 August 2008 will show turnoverof $9.5 million and adjusted* operating profit of $1.0 million. Following theacquisition, Eutek's year end will be changed to December, in line with Hydro's. Hydro plans to maintain the Eutek product brands and use the company's Portland,Oregon, base as a platform to expand Hydro's US wastewater business. SteveTansley, current manager of Hydro International's UK Water and WastewaterDivision, will act as Operations Director of the business, supported by theexisting Eutek management team. George Wilson, who founded the business in theearly 1970s, will be retained as a consultant for a 6 month period. Steve Hides, CEO of Hydro International said: "This acquisition is a perfect fit for Hydro, giving us expanded market share inthe U.S., a West Coast base of operations, and product technologies thatcomplement Hydro's existing wastewater grit-removal portfolio. The market forgrit-removal systems is expanding, driven by the growing need to upgrade andreplace aging equipment and the rising demand for more efficient systems toremove grit from wastewater flows. We look forward to tapping the combined setsof expertise to capitalise on this exciting market opportunity." * Adjusted operating profit excludes costs associated with the previousshareholder. For further information, please contact: Tony HolloxGroup Finance DirectorHydro International plc Tel: +44 (0) 1275 878371 KBC Peel Hunt Ltd (Nominated Adviser and Broker)Julian BluntDaniel Harris Tel: +44 (0) 207 418 8900 6 May 2008 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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