Ensor Holdings PLC Acquisition of Technocover Limited
Ensor Holdings PLC ("Ensor" or "the Company") is pleased to announce the acquisition of 90% of the issued share capital of Technocover Limited ("Technocover"), a manufacturer, supplier and installer of physical security products, based in mid-Wales (the "Acquisition") for a nominal amount (the "Consideration").
Technocover's products are used for the protection of Critical National Infrastructure assets, operated by UK and European Utility companies, including water, energy, communication and transportation. The Directors believe that these government-driven, national security initiatives demonstrate resistance to recessionary pressures.
In the most recent audited accounts which were for the year ended 31 August 2010, Technocover reported sales of £10.3 million and an operating profit of £290,000, prior to loan write-offs of £542,000 and interest charges of £245,000. Net assets at that date were £433,000.
The period since the year end has seen further reorganisation of the business, which, although eliminating its trading profit, has resulted in an underlying profitable, but under-capitalised business.
Ensor will inject cash of £1 million into Technocover, sourced from acombination of the Company's cash reserves and bank debt, to complete the reconstruction of the business.
The Company has agreed to purchase the remaining 10% of Technocover, owned by two of its current directors, for £1 million after 31 August 2015, subject to Technocover achieving an operating profit of at least £1.5 million for the two year period to 31 August 2013.
The Board's expectation is that the Acquisition will result in capitalised goodwill of approximately £500,000, that it will enhance earnings immediately, and will represent an excellent return on investment.