Acquisition

RNS Number : 8459J

Xeros Technology Group plc

03 July 2017

 

3 July 2017

Xeros Technology Group plc

Xeros accelerates entry into personal protection equipment cleaning market with the acquisition of US cleaning business

Xeros Technology Group plc (AIM: XSG, 'Xeros', 'the Group'), the developer and provider of polymer based technologies with multiple commercial applications, has agreed to acquire MarKen PPE Restoration ('MarKen'), which provides personal protection equipment ('PPE'), cleaning, inspection and repair services.

MarKen will be acquired for an initial cash consideration of US$750,000 with a further contingent cash consideration of up to US$250,000, subject to certain growth targets. The initial consideration has been funded from the Group's existing cash resources.

For the year ended 30 April 2017, MarKen generated revenues of US$686,000, generating an EBITDA loss of US$72,000. As at 30 April 2017 gross assets were US$89,000. Management believe that as a result of Xeros' ownership the MarKen business will be profitable going forwards.

The acquisition follows the launch of Xeros' US regulator-approved cleaning solution for the firefighting PPE market in February 2017. The Xeros solution is highly effective at removing harmful contaminants whilst also extending the life of expensive PPE garments. 

MarKen is a leading independent service provider that exclusively uses Xeros' cleaning solution, serving some 25 municipal and military fire departments across the US from its facility in North Las Vegas. The acquisition provides Xeros with rapid, low cost access to the large and highly specialised high-performance workwear cleaning market.

The acquisition will lead to the creation of a new business unit within the Cleaning Technologies division - "Xeros High Performance Workwear"- providing an optimal structure for future development and growth.

An increasingly stringent US regulatory environment is leading to a significant rise in the outsourcing of the cleaning and inspection of PPE to specialist independent providers such as MarKen. This is driven by increased understanding of the health risks associated with soiled and contaminated personal protection equipment and in turn, increasing awareness of the liability exposure associated with poor compliance.

Xeros' cleaning solution is uniquely positioned to meet this demand, which extends beyond firefighting into the petrochemicals, mining and construction industries.

Mark Nichols, Chief Executive of Xeros, said:

"This acquisition provides Xeros with a platform from which to accelerate significantly our penetration of the high-performance workwear market. With more than 58,000 fire stations across the USA alone, this is a substantial market where the benefits of our unique cleaning and decontamination solutions can create significant value.

"The profound expertise we are acquiring and the increased market access we now have will enable us to grow this business very rapidly."

Enquiries:

Xeros Technology Group plc Mark Nichols, Chief Executive Officer Paul Denney, Chief Financial Officer	Tel: [phone]
Jefferies International Limited (Nominated Adviser and Joint Broker) Simon Hardy / Harry Nicholas	Tel: [phone]
Berenberg (Joint Broker) Chris Bowman / Ben Wright / Amritha Murali	Tel: [phone]
Instinctif Partners (Financial PR) Adrian Duffield / Helen Tarbet / James Gray	Tel: [phone]

Notes to Editors

Xeros Technology Group plc (LN: XSG) is a platform technology company that is reinventing water intensive industrial and commercial processes by reducing water and chemistry usage with its polymer technologies.  Its patented technologies have the capacity to provide material economic, operational and sustainability improvements that are unattainable with traditional processes.  The Group is currently exploiting its intellectual property in three areas: Cleaning Technologies, Tanning Technologies and Textile Technologies. Xeros has a number of agreements in place with such international organisations as BASF, Hilton and Wollsdorf Leder.

For more information, please visit - http://www.xerostech.com/

 

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