Ricardo PLC
30 June 2003
30 June 2003
Ricardo Plc ('Ricardo')
Acquisition of the IFT Group of Companies for up to €35.25m (£24.31m)
Expanding Ricardo's presence in Germany
Ricardo, a world leading independent automotive engineering consultancy,
announces the acquisition of the IFT Group ('IFT') for a maximum consideration
of up to €35.25 million (£24.31m), significantly enhancing Ricardo's presence in
Germany, the largest engineering services market outside of North America.
IFT is a private company based in Schwabish-Gmund, the heart of the German
automotive industry approximately 50Km from Stuttgart (Daimler Chrysler); 100 Km
from Ingolstadt (Audi) and 200 Km from Munich (BMW). IFT employs circa 270
people and provides automotive engineering consultancy and engine and vehicle
testing services to the German automotive industry. It is also a leading
supplier of prototype, high performance and niche exhaust systems to customers
including Porsche, Mercedes AMG, Opel and Ford. Following the acquisition
Ricardo will have nearly 300 people based in Germany strengthening Ricardo's
ability to serve existing clients as well as developing new client
relationships.
The consideration comprises an initial cash payment of €23.00 million (£15.86m),
together with a one year earn-out based on increases in profit after tax over
and above €2.30 million (£1.58m). If IFT meets its earn-out targets the maximum
consideration of €35.25 million (£24.31m) will equate to a maximum price
earnings ratio of c. 10x. In addition the vendors who occupy senior management
roles within IFT have agreed to remain in the business for at least the duration
of the earn-out.
For the year ending 31 December 2002, IFT generated profit after tax of €2.50
million (£1.72m) on turnover of €31.20 million (£21.52m). Net assets at 31
December 2002 were €6.0 million (£4.14m). This acquisition is expected to be
earnings neutral after integration costs for the first full year.
Commenting on the acquisition of IFT, Ricardo's Chief Executive Rodney Westhead
said:
'The acquisition of IFT is in line with our strategy to grow significantly our
presence and capability in Germany, the largest automotive market in Europe.
This is an important area of future growth for Ricardo and this acquisition
significantly increases our ability to meet the requirements of our German
customers and also brings a new complementary technology in exhaust systems.
This acquisition follows our recent developments in strategic consulting and the
recent acquisitions of Gemini and Tarragon which together add to our growing,
high added value international activities.'
Enquiries:
Ricardo plc 01273 455611
Rodney Westhead, Chief Executive
Andrew Goodburn, Finance Director
Christopher Bates, Main Board Director with
responsibility for Germany
Website : www.ricardo.com
Gavin Anderson & Company 0207 554 1400
Laura Hickman/Charlotte Stone
This information is provided by RNS
The company news service from the London Stock Exchange
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