Acquisition

RNS Number : 1738W

Halma PLC

23 January 2013

 



Halma plc ('Halma') ACQUISITION OF BAODING LONGER PUMP Halma, the leading safety, health and environmental technology group announces the completion on 23 January 2013 of the acquisition of Thinketron Precision Equipment Company Limited ('TPE') based in Hong Kong and its subsidiaries Baoding Longer Precision Pump Co., Ltd ('Longer Pump') based in China and Langer Instruments Corporation ('LIC') based in the USA. Longer Pump manufactures and markets peristaltic, syringe and gear pumps used in laboratory, medical and industrial applications. LIC is Longer Pump's distributor in the USA. The initial cash consideration was RMB 237 million (£23.7 million) for the share capital of TPE.  Deferred consideration of RMB 3 million (£0.3 million), which is adjustable RMB for RMB if the net tangible asset value (NTAV) is over/under a targeted amount, is payable upon agreement of the NTAV. The targeted NTAV includes approximately RMB 22.5 million (£2.25 million) of cash.   Unaudited accounts for the year ended 31 December 2012 show adjusted operating profit of RMB 23.5 million (£2.35 million).  Audited accounts for the year ended 31 December 2011 show adjusted operating profit of RMB 18.2 million (£1.82 million). Existing management of Longer Pump and LIC will remain in place and will continue to operate the business supported by new Board members appointed from within Halma China. The acquisition, which is expected to be immediately earnings enhancing, has been funded from Halma's cash and debt facilities. Longer Pump will join Halma's Health & Analysis sector within the Fluid Technology sub-sector adding complementary high-value fluid handling products which are sold through a large sales network in China. Approximately 80% of Longer Pump's revenue is generated from China.

Andrew Williams, Halma's Chief Executive, commented: "Longer Pump's alignment with Halma's growth drivers is strong. Sales of their products are driven by increasing demand for healthcare and healthcare research, as well as the urbanisation and industrialisation within China. Their significant local market knowledge and technical resources will help our Fluid Technology sub-sector accelerate growth in this important region. There are also opportunities for Halma to contribute to the growth of Longer Pump, utilising both the network of regional hub offices which Halma has established within China and the worldwide reach of our Fluid Technology businesses."

For further information please contact: Halma plc Andrew Williams, Chief Executive Kevin Thompson, Finance Director	[phone]
MHP Communications Rachel Hirst/Andrew Jaques	[phone]

Notes

1.	Exchange rate used:  RMB 10/£1.
2.	Longer Pump has been specialising in the manufacture of peristaltic pumps, syringe pumps, gear pumps and pump accessories for 15 years. It has significant IP and R&D capabilities with sales to a diverse, mainly non-OEM, customer base.  Peristaltic pumps provide reliable solutions for demanding fluid handling applications in the laboratory, industrial and OEM markets. Growth prospects in their core geographic market of China for peristaltic pumps are strong. One industry forecast expects market growth of approximately 12% for the next several years, before increasing to over 20% in 2016.
3.	Halma buys successful businesses in safety, health and environmental markets and helps them grow further through investment targeted towards increasing innovation, management development and international expansion. In the past 10 years Halma has spent approximately £400m acquiring 30 businesses with deal sizes ranging from £70m down to below £1m. Although businesses have been acquired in all areas of our activity, the majority of recent acquisitions has been in the Health & Analysis Sector.
4.	This statement is not intended to constitute a profit forecast for the current financial period or for any future period.  In addition, this statement should not be taken to mean that the earnings per share of Halma will necessarily match or exceed the historic reported earnings per share of Halma.
5.	A copy of this announcement, together with other information about Halma and its Fluid Technology businesses, may be viewed on our website: www.halma.com.
6.	Halma's next Interim Management Statement will be issued on 14 February 2013.

 

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