Press Release |
19 October 2020 |
Judges Scientific plc
("Judges Scientific", "Judges", the "Company" or the "Group")
Acquisition of Korvus Technology Ltd
Judges Scientific, the group focused on acquiring and developing companies in the scientific instrument sector , announces it has acquired the entire issued share capital of Korvus Technology Limited ("Korvus" or the "Acquisition"), a maker of vapour deposition systems. The Board expects the Acquisition to be immediately earnings enhancing.
The initial consideration for Korvus is £2.64 million in cash. The consideration for the Acquisition has been financed from the Group's £35 million acquisition facility from Lloyds Bank Corporate Markets.
Information and rationale for the Acquisition
Korvus specialises in the design and manufacture of vapour deposition systems used to coat materials with thin films. Korvus' systems are used for academic and industrial research, the majority of sales being to universities. Korvus' systems are particularly versatile with their modular hexagonal design, enabling the users to easily create a combination of accessories to meet their research requirements.
Korvus, based in Tavistock, Devon, was established in 2015 by Dr Lars and Philippa Allers; they will continue in their current roles until March 2021. From April 2021 to March 2025, Dr Allers will act for Korvus as a consultant, predominantly to help with new product development and strategy.
Korvus' statutory accounts for the financial year to 31 March 2020 show revenues of £1.42 million and pre-tax profits of £0.74 million. Net tangible assets amounted to £0.68 million, including cash of £0.16 million. Korvus' operating profit for the year ended 31 March 2020, adjusted to eliminate non-recurring items and to reflect Korvus' ongoing cost base within Judges, would have totalled £0.66 million.
The Acquisition will add to the Group's capability in thin films alongside Quorum and Moorfield.
Terms of the Acquisition
The purchase price of Korvus consists of the following:
· The initial consideration, paid in cash at completion, amounts to £2.64 million;
· Deferred consideration of up to £0.4 million ("Earn-out Consideration") to be satisfied in cash.
The level of Earn-out Consideration payable will be based on Korvus' adjusted EBIT in the year to 31 March 2021.
An additional payment will be made to reflect any excess cash balances over and above the ongoing requirements of the business. The Board expects such payment to be covered by the cash inherited at the completion date.
Alex Hambro, Chairman of Judges, said:
"Korvus is an excellent company with innovative products, which will complement Judges' already strong capabilities in the coating sector, and we are looking forward to working with Phillipa and Lars towards a smooth transition. This cash generative acquisition, which is the third in the past eleven months, will enhance our earnings in accordance with our disciplined acquisition strategy and further demonstrates the resilience of our buy and build model."
For further information please contact:
Judges Scientific |
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David Cicurel, CEO Brad Ormsby, Group FD |
Tel: +44 (0) 20 3829 6970 |
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Shore Capital (Nominated Adviser & Joint Broker) |
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Stephane Auton Edward Mansfield Sarah Mather |
Tel: +44 (0) 20 7408 4090 |
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Tel: +44 (0) 20 3100 2222 |
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Media enquiries : Alma PR (Financial Public Relations) |
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Rebecca Sanders-Hewett Sam Modlin
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Tel: +44 (0) 20 3865 4219 judges@almapr.co.uk |
Notes to editors:
Judges Scientific plc (AIM: JDG), is a group focused on acquiring and developing companies in the scientific instrument sector . The Group now consists of 19 businesses acquired since it was re-admitted to AIM in 2005.
The acquired companies are primarily UK-based with products sold worldwide to a diverse range of markets including: higher education institutions, the scientific communities, manufacturers and regulatory authorities. The UK is a recognised centre of excellence for scientific instruments. The Group companies hold five Queen's Awards for innovation and export.
The Group's companies predominantly operate in global niche markets, with long term growth fundamentals and resilient margins.
Judges Scientific maintains a policy of selectively acquiring businesses that generate sustainable profits and cash. Shareholder returns are created through the repayment of debt, organic growth and dividends.
For further information, please visit www.judges.uk.com