REG - Amcomri Group PLC - Acquisition of EMC Elite Engineering Services
01/04/2025 07:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250401:nRSA0184Da&default-theme=true
RNS Number : 0184D Amcomri Group PLC 01 April 2025
1 April 2025
Amcomri Group plc
("Amcomri", the "Company" or the "Group")
Acquisition of EMC Elite Engineering Services
Amcomri Group plc (AIM: AMCO), the UK focused specialist engineering services
and industrial manufacturing group, announces the acquisition of EMC Elite
Engineering Services Ltd ("EMC"), a niche mechanical and electrical
engineering service provider to the power generation, process and aggregate
industries (the "Acquisition").
The initial cash consideration of £2.5m was paid from existing cash resources
on completion of the Acquisition, with the remaining balance being a
combination of deferred payments and an earn-out agreement, as described in
more detail below.
Highlights
· EMC has a strong reputation in the power generation, process, and
aggregate industry sectors with a long track record of delivering high-quality
maintenance and project based mechanical and electrical services.
· EMC is an established and proven sector specialist with a highly
skilled workforce, generating a strong financial performance and positive
operating cash flow.
· Highly experienced and competent senior management team with
extensive technical knowledge and experience of their chosen market sectors.
· Potential to expand EMC's specialist technical services into adjacent
industrial markets, increase geographic reach, and extend services with key
customers, providing clear growth opportunities for the business, with further
synergy opportunities with other Amcomri companies.
· Demand for EMC supplied maintenance, repair and project services is
driven by regulatory requirements, planned maintenance outages, and equipment
asset upgrading requirements across critical industries, ensuring recurring
revenue and a strong pipeline of opportunities.
Acquisition Rationale
Amcomri has a proven model of acquiring, integrating and enhancing specialist
engineering services and industrial manufacturing businesses. EMC is well
aligned with the Group's industrial strategy and has built a strong reputation
over 10 years in the power generation, process, aggregates and energy sectors,
supported by its track record of delivering high-quality maintenance,
mechanical and electrical services, evidenced by its growth profile.
Within its chosen market sectors, EMC has built up a diverse customer base
consisting of well-established, high-quality businesses in largely stable,
regulatory-driven markets, providing both resilience and long-term growth
potential, both for EMC and the Group. In particular, the Acquisition brings
to the Amcomri Embedded Engineering Division significant large 'rotating
equipment' maintenance and overhaul expertise including multi-stage pumps,
power generation turbo-alternators, and aggregate milling systems. With
additional expertise in low and medium voltage electrical systems, power
generators, and more recently renewable energy storage systems, EMC also
complements the existing Group's high voltage engineering capabilities in its
WJ Project Services business and supports the Group's entry into selected
renewable energy technologies.
For the year ending 31 August 2024, EMC generated revenues of £5.7m and
profit before tax of £0.9m. As at 31 August 2024, EMC had net assets of
£1.6m.
Terms of the Acquisition
Amcomri has entered into a share purchase agreement with Jamie Herbert,
Michelle Herbert, David Lewis and Andrea Lewis (the "Sellers") under which the
Group has acquired the entire issued share capital of EMC for an initial cash
consideration of £2.5m, which was paid from existing cash resources. Deferred
consideration of £1.5m is payable in cash in stages - with equal payments of
£500,000 being paid 12, 24 and 36 months post completion of the Acquisition.
In addition, an earn-out agreement is in place whereby the Sellers will be
entitled to 25% of any annual EBITDA achieved above £880,000 in each of the
three years post completion. Under this arrangement any payments will be
capped at £280,000 per year.
All of EMC's employees will continue to be employed by EMC following the
Acquisition.
Hugh Whitcomb, Co-Founder and CEO of Amcomri, commented:
"We are delighted to confirm EMC as our first acquisition since admission to
AIM in December last year. We have an ambitious organic and acquisitive growth
strategy, and we are very pleased to welcome David Lewis, Jamie Herbert, and
all of the EMC team to the Group, as we continue to roll out our proven 'Buy,
Improve, Build' model. EMC has an outstanding team and reputation, which we
believe will significantly enhance our Embedded Engineering capability and
technical service offering going forward, and we very much look forward to
working with Dave, Jamie and the EMC team."
"2025 has started well across the Group and I look forward to providing a
trading update for the financial year ended 31 December 2024 and the
commencement of the current financial year, next month."
Certain of the information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the UK version of
the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of
the European Union (Withdrawal) Act 2018, as amended and supplemented from
time to time.
Enquiries:
Amcomri Group plc Via Walbrook
Hugh Whitcomb, Chief Executive Officer Tel: +44 (0)20 7933 8780
Mark O'Neill, Investment Director
Siobhán Tyrrell, Chief Financial Officer
Cavendish Capital Markets Limited Tel: +44 (0)20 7220 0500
Adrian Hadden/Katy Birkin/Dan Hodkinson - Corporate Finance
Michael Johnson/Jasper Berry/Andrew Burdis - Sales/Broking
Walbrook PR Ltd Tel: +44 (0)20 7933 8780
Tom Cooper / Nick Rome amcomri@walbrookpr.com
To find out more, please visit: www.amcomrigroup.com
(http://www.amcomrigroup.com)
Notes to Editors:
Amcomri is a "Buy, Improve, Build" group focusing on acquiring, integrating
and enhancing specialist engineering services and industrial manufacturing
businesses that provide technical services to major UK infrastructure,
transportation and energy companies and bespoke mission-critical services to a
diverse range of sectors and markets.
The Group currently operates through the following two divisions:
(i) Embedded Engineering Division: provides specialist technical and
engineering services for major industrial, infrastructure and transportation
clients, typically with complex technical needs and undertaken in operating
environments where safety and compliance performance are critical
requirements. The division predominantly provides engineering services and
support for their clients' capital intensive, mission-critical assets such as
high voltage electrical transmission systems, petrochemical and continuous
process operations, and large power generation plants.
(ii) B2B Manufacturing Division: focuses on selective niche B2B markets or
businesses, where the Group has identified an opportunity to achieve enhanced
financial performance by leveraging an initially strong competitive market
position combined with the Group's business improvement capabilities.
The Group operates across a diverse range of sectors and markets, including
industrial, infrastructure and mass transportation. The Group deploys a
structured "Buy, Improve, Build" strategy with a track record of value
enhancing acquisitions in the industrial environment. It has a particular
focus on leveraging the Group's experience and track record in relation to
acquisitions arising from owner manager 'retirement' situations, where there
are no, or limited, alternative plans for succession to sustain the enterprise
value present within the target business.
The Group has been created through a series of 16 successful acquisitions,
comprising the acquisition of 12 operating companies and 4 bolt-on
asset/business purchases, each of which has been integrated into the Group.
Post acquisition, the Group has a strong focus on facilitating and supporting
its operating companies with organic growth initiatives, and the Group's
businesses are well placed to take advantage of generally positive conditions
in their respective niche end markets. This combined 'Buy-Improve-Build' model
has delivered compound annual Group revenue growth of 48.8 per cent. between
FY21 and FY23 and seen Group turnover rise from £21.3m to £47.1m over the
same period.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END ACQPKDBQOBKDKNN