Spectris plc Acquires Engineering Seismology Group
Spectris plc ("Spectris") (LSE: SXS), the productivity-enhancing instrumentation and controls company, today announces that it has completed the acquisition of the privately-held Canadian group Engineering Seismology Group ("ESG"). The purchase consideration of C$64 million (approximately £36 million), on a debt and cash-free basis, will be met from existing cash and bank facilities and is subject to routine balance sheet adjustments. In addition, a contingent consideration may become payable to the sellers based on the achievement of certain sales growth targets for the three-year period beginning 1 January 2015.
ESG is a leading provider of microseismic monitoring equipment and analysis solutions, primarily to the oil and gas and mining sectors, as well as to other industries. ESG has been growing rapidly and has significant opportunities to accelerate its growth because its technology enables oil and gas and mining companies to enhance their productivity and improve their return on investment. ESG's technology, products and solutions optimise the recovery rates of both existing and new oil and gas reservoirs and support the development of cost-efficient extraction processes in a safe manner that minimises the impact on the local environment. ESG will become a separate operating company within Spectris' Test and Measurement segment. More information on ESG can be found at www.esgsolutions.com.
Eoghan O'Lionaird, Business Group Director, said: "ESG is a good strategic addition to Spectris' Test and Measurement segment as it is a leader in a niche high-growth, productivity-enhancing technology. We believe there is a significant opportunity for ESG to strengthen its market position, expand internationally and accelerate its growth, both organically and via further acquisitions. Supported by Spectris' global reach and expertise ESG will also benefit from sharing capabilities and technology with other Spectris operating companies. This acquisition demonstrates Spectris' ability to expand into new technology platforms where there are high barriers to entry and which provide additional sources of growth by enhancing productivity for customers. The acquisition also fits the Spectris financial profile of attractive margins and strong cash generation."