ACQUISITIVE engineer Pressure Technologies is to buy precision engineering group Quadscot Holdings for up to £10.3m and said it has agreed a new £25m finance package with Lloyds Bank Commercial Banking.
Sheffield-based PressureTech said Quadscot will become part of its engineered products division and it expects the acquisition to be earnings enhancing immediately.
The deal comes just a fortnight after PressureTech bought New Zealand-based company Greenlane Biogas for up to £12.4m.
The maximum total payment for the Quadscot acquisition is £10.3m (plus cash balances), including an initial cash consideration of £7.3m with additional deferred payments, split over two years, of up to a maximum of £3m, based on Quadscot’s future financial performance.
The initial consideration will be met from the bank facilities and existing resources.
Alan Wilson, chairman of PressureTech, said: “The acquisition of Quadscot is further evidence of the group’s ability to identify well-run, profitable businesses that will benefit from being part of Pressure Technologies, whilst also making a significant contribution to the future performance of the group.
“Quadscot has an excellent reputation in its market and we are delighted to welcome all of the employees to the group.”
Analyst Richard Hickinbotham said: “We believe the acquisition to be an excellent fit with the group’s existing businesses, Al-Met and Roota Engineering. Quadscot is profitable and cash generative, and it has good near-term order visibility. There are also significant opportunities to further expand Quadscot’s customer base.”