Deals



Diploma PLC Acquires Kubo Group


Posted: 13th March 2015 09:38

Diploma PLC, the international group of businesses supplying specialised technical products and services, is pleased to announce the acquisition of 100% of Rutin AG, the Swiss non-trading holding company of the Kubo Group ("Kubo") of companies based in Switzerland and Austria.
 
Kubo is a long established and leading supplier of seals, O-Rings, gaskets and moulded rubber parts to a large and diverse base of industrial customers in Switzerland and Austria. Kubo's principal location is in Effretikon, near Zurich in Switzerland, comprising a modern building with a combination of warehouse, manufacturing and office facilities. Kubo employs ca. 100 people, of which ca. 15 are based in the facility in Linz, Austria.
 
Kubo serves both the Industrial OEM and Aftermarket sectors, typically in applications that require a high degree of technical knowledge and support. The business specialises in high value products that address harsh environments or complex applications. Kubo also retains exclusive distribution rights in Switzerland and Austria for certain large international manufacturers of sealing products and O-Rings.
 
Prior to acquisition, Kubo was privately owned by Dr Thomas Raible, its Chief Executive Officer ("CEO") and majority shareholder, together with members of the Gebert family (Cyrill, Manuel and Rebecca, represented by Christa Gebert) and Dr Georges Bindschedler.  Of the Sellers, only Dr Raible had an active management role in Kubo and he will remain as the CEO of Kubo until 30 June 2015 to ensure a smooth management transition. 
 
Profit before tax for Kubo in the year ended 31 December 2014 was CHF4.9m (£3.4m) on revenues of CHF32.4m (£22.2m); gross assets at 31 December 2014 were CHF36.1m (£24.7m). 
 
The cash consideration before acquisition costs is CHF39.9m (£27.3m), which will be met from the Group's existing cash resources and revolving bank credit facility. At completion, net assets are expected to be approximately CHF30.3m (£20.7m), including net cash of approximately CHF7.0m (£4.8m) and goodwill of CHF11.6m (£7.9m).  Also included in the net assets is the freehold facility in Effretikon, with a net book value of CHF7.0m (£4.8m) and a market value of at least CHF10.0m (£6.8m).  
 
This transaction will be immediately earnings enhancing to the Company and will be reported as part of the Seals sector activities.
  
Bruce Thompson, Chief Executive of Diploma PLC said:
 
"The acquisition of Kubo Group fits very well with Diploma's strategy in Seals of building a stronger European business in the supply of seals, gaskets and related products to both the Industrial OEM and Aftermarket sectors. The acquisition will also open up opportunities for cross selling of products with Diploma's other Seals businesses, including access to Kubo's high precision, manufactured parts."

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