Plc (AIM:PROV), a provider of specialist steam cleaning and coatings
technologies, is pleased to announce the acquisition of an 80 per cent. equity
stake in Contico Manufacturing Limited ('Contico'), a manufacturer and
distributor of cleaning and hygienic products, for a total consideration of
approximately £5.5 million (US$11 million).
Contico, based in Redruth, Cornwall, UK, sells throughout the UK, as well as
exporting to Europe, the Middle East and Far East. Contico generated turnover
for the year ended 31 December 2006 of £8.8 million and profits before tax of
£0.4 million. Contico, which is debt-free, had net assets of approximately
£2.75 million as at 1 June 2007. Therefore, the acquisition of this significant,
controlling stake in Contico is expected to substantially increase the Company's
revenue, and contribute immediately to profitability.
The deal has been financed with approximately £3.7 million from the Company's
existing cash reserves and £1.8 million from new bank debt. Approximately £5.1m
of the consideration is payable on completion with the balance being paid
following confirmation of the completion balance sheet as at 1 June 2007. The
remaining 20 per cent of Contico will be owned by the current management.
David Chestnutt, Chief Executive of Proventec, said: 'This acquisition of a
controlling stake in Contico will provide further important routes to market for
Proventec's existing lines and new innovations. It will also provide the
necessary critical mass to service and offer cross-selling opportunities to key
accounts. Contico has an established and experienced management team that has
been in place for over twelve years and we are extremely excited about working
with them going forward.'
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For further information, please contact:
Proventec Plc
David Chestnutt, Chief Executive Tel: + 44 (0) 151 706 0626
dchestnutt@proventecplc.com www.proventecplc.com