Engineering group combats slip into the red with acquisition
SHEFFIELD-BASED engineering group Pressure Technologies is looking to diversify its business with its latest acquisition following a profit warning earlier this year.
Pressure Technologies has acquired Martract, which specialises in the grinding and lapping of ball and seat assemblies and gate valves, for £4.3m.
The deal for the company sees Pressure Technologies diversify outside the oil and gas market, which has proved challenging of late, leading to a profit warning in August 2016. In it, the company said that project delays will have a “significant impact” on profitability this year.
But its new acquisition Martract reportedly has “unrivalled” intellectual property and has been a customer of Pressure Technologies for 15 years. 60% of its business comes from outside the oil and gas market, including nuclear and industrial.
It said that the acquisition would be “immediately” earnings enhancing, reduce lead times and supply chain risk.
The £4.3m deal consists of a cash consideration of £3.7m and a conditional deferred payment of up to £600,000.
Martract was established in 1978 and for the year ended 31 August 2016 Martract had unaudited revenues of £1.2m and adjusted proforma EBITDA of £450,000. It is based at the Humber Bridge Industrial Park at Barton-upon-Humber.
John Hayward, CEO of Pressure Technologies, said: “This is an exciting acquisition for the Group, which strengthens our existing market position and gives significant opportunity to penetrate new markets.
“Martract’s reputation for technical ability and quality sits well with our Group capabilities and we are delighted to welcome its dedicated and highly-skilled workforce to the Group.”
