For immediate release Monday, 12 October 2009
Keller Group plc
Acquisition of Resource Holdings Limited, Singapore
Keller Group plc ("Keller" or "the Group"), the international ground
engineering specialist, has entered into an agreement to purchase Resource
Holdings Limited ("Resource"), a Singapore-based foundation contractor, for an
initial cash payment of S$68.2m (£30.6m), including an estimated S$4.5m (£2.0m)
of acquired net debt, plus further payments based on future profits.
Resource is a specialist foundation contractor with particular expertise in
large diameter bored piling in soft clays. With over 20 years' experience,
Resource has an excellent reputation locally and has worked on some of
Singapore's most prestigious projects in both the public and private sectors.
The senior management of Resource is remaining with the business.
This acquisition will add critical mass to, and significantly strengthen, the
Group's existing operations in Singapore. By extending its product range, it
will enable the Group to offer packaged solutions which combine Keller's
existing ground improvement techniques with Resource's piling products. Over
the medium term, the acquisition will also assist Keller in growing its heavy
foundations capability in South East Asia.
Resource has grown rapidly in recent years, helped by a buoyant Singapore
construction market. In the year ended 31 March 2009, Resource reported an
operating profit of S$23.9m (£10.7m) on revenue of S$116m (£52.0m), an
operating margin of 20.5%. However, Keller does not expect this exceptional
level of profitability to be sustainable over the short to medium term, as the
effects of the global recession moderate Singapore's rate of growth.
Resource has made significant investment in its equipment fleet in recent
years. At 31 March 2009 the business had gross assets of S$48.3m (£21.7m) and
net assets of S$24.3m (£10.9m).
The total consideration, to be paid in cash from the Group's existing
facilities, will comprise an initial payment of S$68.2m (£30.6m), including an
estimated S$4.5m (£2.0m) of acquired net debt, together with a maximum deferred
consideration of S$50m (£22.4m) based on profits over the period to 31 March
2013.
Completion is expected by the end of October.
Commenting on the acquisition, Justin Atkinson, Chief Executive of Keller,
said:
"We are excited by this important acquisition, which will significantly
increase the size of the Group's operations in South East Asia and add further
momentum to our move into heavy foundations in these attractive growth
markets."
For further information, please contact:
Keller Group plc www.keller.co.uk
Justin Atkinson, Chief Executive 020 7616 7575
James Hind, Finance Director
Smithfield 020 7360 4900
Reg Hoare/Will Henderson
*A Private Investor is a recipient of the information who meets all of the conditions set out below, the recipient:
Obtains access to the information in a personal capacity;
Is not required to be regulated or supervised by a body concerned with the regulation or supervision of investment or financial services;
Is not currently registered or qualified as a professional securities trader or investment adviser with any national or state exchange, regulatory authority, professional association or recognised professional body;
Does not currently act in any capacity as an investment adviser, whether or not they have at some time been qualified to do so;
Uses the information solely in relation to the management of their personal funds and not as a trader to the public or for the investment of corporate funds;
Does not distribute, republish or otherwise provide any information or derived works to any third party in any manner or use or process information or derived works for any commercial purposes.
Please note, this site uses cookies. Some of the cookies are essential for parts of the site to operate and have already been set. You may delete and block all cookies from this site, but if you do, parts of the site may not work. To find out more about the cookies used on Investegate and how you can manage them, see our Privacy and Cookie Policy
To continue using Investegate, please confirm that you are a private investor as well as agreeing to our Privacy and Cookie Policy & Terms.