Surveillance group Synectics looks for Far East growth with £2m acquisition

WARWICKSHIRE-based security and surveillance group Synectics has expanded its overseas operation with the £2.1m acquisition of a company in Singapore.

Coex Services Asia Pte Ltd supplies surveillance systems in the Far East, primarily to the oil & gas sector. In its audited results for the year ended December 31, 2012, CSA reported a pre-tax profit of £0.2m on revenue of £2.4m and net assets of £0.9m.

Synectics has held a 20% interest in CSA since 2004. The Singapore subsidiary of the Studley-based group has now purchased the remaining 80% of CSA’s share capital for an initial consideration of £1.8m, comprising £1.3m in cash, 101,403 Ordinary Shares in Synectics (valued at £0.4m on May 31, 2013), and the transfer of the group’s 20% interest in a related company valued at £0.1m.

CSA currently has net assets of approximately £1.1m and holds net cash of around £0.9m. In addition, further consideration of up to £0.3m will be payable in cash dependent on the profit performance of CSA in the two years following acquisition.

Under the terms of the acquisition the CSA directors, and previous principal shareholders, Kenny Tan (Managing Director) and Veronica Chua (Finance Director) will remain with CSA for a minimum period of three years.

Commenting on the acquisition, John Shepherd, Chief Executive of Synectics, said: “Development of our business in the Far East is a significant part of our strategy, and so we are delighted to bring CSA fully into the group and secure the services of Kenny Tan and Veronica Chua to expand our operational hub in Singapore.”