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AdEPT Technology agrees ETS purchase
Posted on Thursday, 08 November 2018 16:15
London-listed AdEPT Technology, a maker of communication products, has signed on the dotted line to pick up ETS Communications, its Wakefield-headquartered peer.
Under the terms of the transaction, the buyer will pay GBP 2.50 million in cash for the business, minus the target’s net debt as of 31st October 2018.
An additional earn-out component of up to GBP 1.75 million in cash may be due at a later date, subject to ETS’s trading performance in the year to 31st October 2019, with the consideration to be financed using AdEPT’s enlarged bank facility.
The acquiror believes the assets being picked up through the deal will complement its current communication services offering.
Commenting on the purchase, AdEPT chief executive Ian Fishwick said: “With AdEPT having an existing specialist Avaya IP Office operation in Northampton, the acquisition of ETS builds on this capability and extends the geographical reach to Yorkshire and Lincolnshire.
“ETS has a well-developed customer base with long term relationships, which builds upon AdEPT's existing public sector healthcare presence. The acquisition is expected to be earnings enhancing from completion."
The buyer said it may also use its bank facility to fund some acquisitions, intended to boost the firm’s growth.
In addition to the takeover, AdEPT has announced a GBP 5.00 million extension to its existing GBP 30.00 million five-year revolving credit facility agreement.
ETS Communications was founded in 1981 and has a customer base numbering over 4,000.
Its offering includes telephone systems, cloud phone, line rental and superfast broadband, among other services.
According to Zephyr, the M&A database published by Bureau van Dijk, there have been 792 deals worth a combined USD 91.12 billion targeting telecommunications companies announced worldwide since the beginning of 2018, compared to the USD 117.06 billion injected across 1,104 deals in the whole of 2017.
2018’s largest deal in the sector to date featured Vodafone buying Liberty Global’s European operating companies for USD 21.82 billion.
© Zephus Ltd