Acquisition of Comdel
02 October 2017
XP Power, a world-leading developer and manufacturer of critical power control solutions for the electronics industry, announces that it has acquired the business and assets of Comdel Inc. ("Comdel"), a designer and manufacturer of radio frequency ("RF") power supplies (the "Acquisition").
Total consideration of US$23.0 million (£17.0 million) was paid in cash on completion. The Acquisition is on a debt and cash free basis and was funded with a new revolving credit facility of US$40.0 million with a US$20.0 million additional accordion option. The new facility is in place to assist the company's inorganic growth strategy.
Comdel is based in Massachusetts, USA, and supplies the industrial and technology sectors with a range of standard, modified and custom high power RF power conversion products. Comdel typically supplies RF power supplies to the semiconductor, thin film, photovoltaics, and induction heating industries. In the fiscal year ended 31 December 2016, Comdel recorded sales of US$16.5 million (£13.0 million), profit before tax of $1.8 million (£1.4 million) and had gross assets at the year end of $10.9 million (£8.5 million). The Acquisition is expected to be enhancing to the Company's earnings per share in 2018*.
Comdel and XP Power share several customers, and while there is no direct overlap in product lines, the power supply solutions of the two companies are considered highly complementary. Comdel's products and engineering capabilities will enhance the Group's ability to implement its strategy of winning a greater share of business from its largest customers by achieving wider vertical penetration of key accounts. As well as a product offering suitable for an array of applications used by some of XP Power's existing customer base, Comdel will also bring a number of new customers to the Group.
Scott Johnson, Chief Executive Officer of Comdel, will remain with the business and head up XP Power's newly formed RF Power division.
Duncan Penny, Chief Executive of XP Power, said:
"We are delighted to welcome Comdel to the XP Power Group and are excited about the opportunity of offering its complementary product range through our global sales channel. The Acquisition will enable us to provide our existing customers with a comprehensive product offering in RF power, a market segment with robust demand fundamentals but one in which we did not previously specialise. We are confident that Comdel will have a very successful future as part of XP Power."
* This statement does not constitute a profit forecast
|Duncan Penny, Chief Executive Officer||+44 (0)118 976 5086|
|Jonathan Rhodes, Finance Director||+44 (0)118 976 5074|
|Citigate Dewe Rogerson||+44 (0)20 7638 9571|
|Kevin Smith/Jos Bieneman|
Note to editors
XP Power is a leading international provider of essential power control solutions. Power direct from the electricity grid is unsuitable for the equipment which it supplies. XP Power designs and manufactures power converters - components which convert power into the right form for our individual customers' needs, allowing their electronic equipment to function. XP Power supplies the healthcare, industrial and technology industries with this mission critical equipment. Significant, long term investment into research and development means that XP Power's products frequently offer significantly improved functionality and efficiency.
For further information, please visit www.xppower.com