Deals
Byotrol plc Acquires Byotrol Consumer Products Ltd
Byotrol plc ('Byotrol' or the 'Company'), the developer of anti-microbial hygiene technologies, is pleased to announce that on 2 October 2013 it has entered into an agreement to acquire all of the issued shares that it does not currently own in its consumer products joint venture, Byotrol Consumer Products Ltd (the "Acquisition"). The consideration for the acquisition will be the issue of 33,740,000 new ordinary shares in Byotrol plc ("Consideration Shares"). Completion is expected to take place on 9 October 2013.
The combination of Byotrol Consumer Product's marketing strategy and Byotrol's product and technical knowhow will create a more efficient and focussed entity enabling optimised relationships with partners who increasingly work in both consumer and business to business markets. Harnessing these specialist skills under one roof presents clear revenue growth potential through additional cross-selling opportunities, whilst synergies from the acquisition will achieve savings for the wholly-owned business.
Byotrol Consumer Products Ltd ("BCP") was established in 2007 as a 50:50 joint venture between Byotrol plc and ?What If! Innovation Capital Nominees Ltd. BCP was responsible for developing commercial relationships and product sales in the global consumer market.
Since establishment, BCP has developed valuable relationships with major organisations in the consumer products market, across a wide geography. This strategy has promoted Byotrol as a technical partner to major multinationals, whilst giving Byotrol access to global markets.
For the year ended 31 March 2013 the unaudited statutory accounts of Byotrol Consumer Products Ltd showed revenues of £858k and a profit before tax of £134k. The consolidation of the operations of BCP is expected to be immediately earnings enhancing for Byotrol.
Commenting on the acquisition, Ralph Kugler, Chairman of Byotrol, said
"The acquisition of BCP is an important strategic step for Byotrol in being able to fully develop market opportunities. The combination of the two companies will increase our sales opportunities in consumer and business markets at a lower overall cost. Byotrol is committed to building on BCP's achievements to maximise value for our shareholders."
Gary Millar, Chief Executive of Byotrol, added:
"The full ownership of BCP gives Byotrol the opportunity to streamline its sales focus whilst benefitting from the additional margin contribution resulting from a consumer product sales approach.
"We continue to see considerable opportunity for the Byotrol technology in consumer products markets and believe that better outcomes will be achieved with BCP more tightly integrated into the Company. Optimising the combined skill sets of both businesses will lead to significant market opportunities."
David Traynor, Managing director of BCP, added:
"Having worked closely with Byotrol PLC for over 5 years, we can see that the combination of the two businesses is based on sound strategic logic and playing on our combined strengths will enhance the total organisation."
The Acquisition
The sellers of BCP shares are the current shareholders of BCP other than Byotrol, namely ?What IF! Holdings Ltd 2004 EBT, Bricon-Byotrol Ltd, ?What If! Holdings Ltd, Matt Kingdon, David Allan, Salil Pajwani, David Traynor, Trevor Francis and Nicholas Stanley (the "Sellers").
As well as the issue of Consideration Shares, the Sellers have agreed to waive all intra-group indebtedness owed by BCP to any Seller or any connected party.
Each of the Sellers has agreed not to dispose of any Consideration Shares for a period of 24 months from Admission (as defined below), subject to certain exceptions.
In addition, ?What If! Holdings Ltd has been granted a right to nominate one director to the board of Byotrol for the duration of the restriction on disposals referred to above.
Following completion and the issue of the Consideration Shares, Bricon-Byotrol Ltd will hold 14,599,038 Ordinary Shares in Byotrol, representing 7.96% of its enlarged issued share capital following the Acquisition.
Admission
The Consideration Shares will be issued from existing authorities granted to the Directors at the latest annual general meeting. The Consideration Shares represent 18.4% of the enlarged issued share capital of the Company following their issue.
Application has been made for the Consideration Shares to be admitted to trading on AIM ('Admission') and it is expected that such admission and dealings in the Consideration Shares will occur on AIM on 9 October 2013. The Consideration Shares will rank pari passu with the existing Ordinary Shares currently in issue. Following Admission, there will be 183,368,101 Ordinary Shares in issue.
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