Double deal for Flowtech
TECHNICAL fluid power products supplier Flowtech Fluidpower has made two acquisitions in a busy end to its first year as a public company.
The Skelmersdale-based group which floated on AIM in August 2014 has splashed-out £5.8m to boost its product offering in the hydraulics sector with a deal for Northern Ireland-based Nelson Hydraulics.
Nelson, a family business for 50 years and with 40 staff, Flowtech is paying £4.1m in cash and taking on £1.7m in net cash.
Nelson distributes hydraulic equipment, components and hose assemblies from its locations at Lisburn and Dungannon in Northern Ireland and Dublin in the Republic of Ireland. It has a broad customer base in Ireland with emphasis in the crushing and screening, agricultural and marine and fishing sectors.
For the year ending September 2014, turnover was £6.7m producing EBIT of £0.7m. Net assets at the same date were £4.1m.
Flowtech is paying £2.9m in cash on completion with further payments over the first two years of ownership expected to be £1.2m in cash, contingent on the average EBIT performance of Nelson Hydraulics for the periods ending 30 June 2017.
Nelson Fluid Power (the parent company of the hydraulics business) will operate as an independent sister company within the Flowtech Group and will add significantly to its procurement position in hydraulic components, hose and couplings.
The current management team will remain in place; managing director, Mark Nelson who has been with the business for over 25 years will also join Flowtech’s operational Board.
Meanwhile, Flowtech said that in late May it had acquired Albroco for £1m. Based in North Wales the business is a distributor of hydraulic and electro-mechanical components to the mobile, on- and off-highway and construction markets.
For the year ended 31 October 2014, turnover was £1.4m producing a profit before tax of £0.2m. Net assets at the same date were £0.8m.
Flowtech Fluidpower chief executive Sean Fennon said: “The acquisition of NFP and Albroco continues the progressive development of Flowtech, and along with Primary Fluid Power will both sit within a newly formed division providing clear focus on the power and motion control market.
“In addition the acquisitions widen the geographical areas and customer sectors we serve, and extends significantly the group’s hydraulic offer and procurement opportunities.”
Flowtech said it was trading in line with market expectations, while trading remains “competitive”.
It will report half-year results for the six months to June 30 on September 8.
