REG - TT Electronics PLC - Acquisition of Ferranti Power & Control business

TT electronicsAnnouncement

10/01/2022 07:05

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RNS Number : 8508X  TT Electronics PLC  10 January 2022

 

 

10 January 2022

 

TT Electronics plc

 

Acquisition of Ferranti Power & Control business

 

 

TT Electronics plc ("TT" or the "Group"), a global provider of engineered
electronics for performance critical applications, has acquired the Power and
Control business of Ferranti Technologies Ltd ("Ferranti P&C"), from Elbit
System UK Ltd ("ESUK") for £9.0 million in cash, subject to customary
post-completion working capital adjustments.

 

Highlights of the Acquisition

 

Ferranti P&C, based in Greater Manchester, designs and manufactures
mission-critical complex power and control sub-assemblies for blue chip
customers in high-reliability and high-performance end markets, primarily
aerospace and defence. One of the principal benefits of the acquisition is
that it brings highly skilled employees who provide full-service capabilities
from design, assembly, manufacturing, and testing including environmental
stress screening and inspection through to service.

 

Ferranti P&C adds further technology capability, IP and scale to TT's
Power Solutions business, which is one of our focus areas for structural
growth. It has valuable long-term customer relationships and programmes with
leading global aerospace, defence and industrial OEMs operating in highly
regulated markets with significant barriers to entry through necessary
industry accreditations and customer approvals.

 

The acquisition is expected to be modestly earnings enhancing, to generate
mid-teens operating margins and to generate a return on invested capital in
excess of the Group's WACC in year 1. We expect to generate cost synergies of
circa £0.4 million by year 3.

 

Current Trading

 

TT confirms that trading for the full year was in line with the update
provided on 23 November 2021.

 

Commenting on the acquisition, Richard Tyson, Chief Executive Officer said:

 

"We are pleased to announce the acquisition of Ferranti's Power and Control
business which is in line with our strategy for growth at higher margins and
moving up the value chain in our target end markets in A&D. This highly
attractive platform adds scale and technology capabilities to our Power
Solutions business in Europe. We expect to achieve our financial return hurdle
rate in the first full year.

 

I am delighted to welcome Ferranti Power and Control's highly skilled team to
TT as we continue to build differentiated capabilities and engineer smarter
solutions for our customers."

 

 For further information please contact:
 TT Electronics plc                          Tel: +44 (0)1932 825 300
 Richard Tyson, Chief Executive Officer

 Mark Hoad, Chief Financial Officer

 Kate Moy, Head of Investor Relations

 MHP                                         Tel: +44 (0)20 3128 8100
 Tim Rowntree / Rachel Mann
 (1)

Note:

TT will announce its full year results on 9 March 2022.

About TT Electronics

TT Electronics is a global provider of engineered electronics for performance
critical applications. The Company works with market-leading customers in the
industrial, aerospace and defence, medical, and transportation sectors. TT has
three divisions, Sensors and Specialist Components, Power Electronics and
Global Manufacturing Solutions.

The product offerings in the Sensors and Specialist Components division
include circuit protection, current sensing, signal conditioning,
optoelectronics, and sensors for torque, position, pressure, flow and
temperature. The Power Electronics division typically designs and manufactures
specialist, high reliability electronic components and
sub-assemblies supplying into power management, engine controls and
connectivity systems. The Global Manufacturing Solutions division provide
high mix low volume manufacturing solutions for products in a wide range of
end applications ranging from medical devices, to power control modules used
in rail transport infrastructure.

Cautionary statement

This announcement contains forward-looking statements. These have been made by
the directors in good faith based on the information available to them up to
the time of their approval of this announcement. The directors can give no
assurance that these expectations will prove to have been correct. Due to the
inherent uncertainties, including both economic and business risk factors
underlying such forward looking information, actual results may differ
materially from those expressed or implied by these forward-looking
statements. The directors undertake no obligation to update any
forward-looking statements whether as a result of new information, future
events or otherwise.

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