LONDON, UK: discoverIE Group (LSE: DSCV), a number one worldwide designer and producer of customised electronics to industry, has introduced the acquisition of Magnasphere Corporation.
Magnasphere Corporation, a US-based designer and producer of magnetic sensors and switches for industrial digital applications, is being acquired, for a money consideration of $22m (£19.1m) on a debt free, money free basis, earlier than expenses, which will be funded from the Group’s existing debt facilities.
Vendor shareholder approvals for the transaction are anticipated to be received throughout the ultimate quarter of this monetary year. Once completed, the acquisition is anticipated to be instantly accretive to Group underlying earnings and underlying working margin.
Magnasphere, based in 2002, designs and manufactures excessive efficiency magnetic sensors and switches for industrial digital markets together with entry control, data centres and specialist vehicles. The business, which is currently majority owned by management, is based in Waukesha, Wisconsin, with manufacturing facilities in Goshen, Indiana.
The enterprise will function inside the Group’s Variohm cluster of specialist sensor companies as a half of the Sensing & Connectivity division while retaining its distinct model identity. Under succession plans, administration shareholders will transition management to existing ongoing administration over a interval of as much as twelve months.
Revenues for the year ended 31 December 2021 were $6.8m (£5.7m) with a reported pre-tax revenue of $1.9m (£1.6m), and an working margin of 28%. Gross assets at 31 December 2021 were $5.9m (£5.1m). The enterprise has continued to develop well in 2022.
Following completion of the acquisition, the Group’s proforma gearing as at 30 September 2022, the Group’s most up-to-date six month interval end, will increase from 0.8x to 1.1x, remaining below our lengthy run goal vary of between 1.5 and 2.0x, leaving capability for additional acquisitions. The pipeline of acquisition alternatives in development stays strong.
Nick Jefferies, Group Chief Executive of discoverIE plc, said: “This acquisition of Magnasphere continues our technique of constructing a differentiated, international, growth focused electronics Group with strong working margins. The transaction brings one other excessive high quality enterprise into discoverIE, which is accretive to each underlying earnings and margins, and strengthens our US footprint.
Magnasphere Corporation has a long-established track record of producing and supplying excessive high quality customized sensors throughout the US. Operating inside our Variohm cluster of sensor businesses, Magnasphere will gain entry to our wider base of customers and with it, new gross sales alternatives in our goal markets. We are delighted to welcome the Magnasphere team into discoverIE Group.”