Business
Acquisition of RMDG
Acquisition of RMDG.
About this update from Avingtrans Plc
[{"type":"text","content":"\n \nRNS Number : 3420O Avingtrans PLC 06 August 2014 \n \n\n6 August 2014\n \nAvingtrans Plc\n(\"Avingtrans\" or the \"Company\" or the \"Group\")\n \nAcquisition of RMDG\nTrading Update and Notice of Results\nAvingtrans plc (\"Avingtrans\" or \"the Company\"), which designs, manufactures and supplies critical components and associated services to the global aerospace, energy, and medical sectors, announces that it intends to acquire the trade and certain business assets and liabilities relating to the manufacture of aerospace components from Tricorn Group plc's (\"Tricorn\") subsidiary, RMDG Aerospace (\"RMDG\" and the \"Acquisition\") for a cash consideration of £1.1 million, excluding costs. The Acquisition is due to be entered into and completed on or before 12 August 2014, following employee consultation.\nHighlights of the Acquisition:\n· Strengthens the Group's Aerospace division, Sigma Components (\"Sigma\")\n· Cash consideration of £1.1million\n· Reinforces Avingtrans' position with certain existing customers, as well as introducing new customers to the Group\nThe principal activity of RMDG, located in Swadlincote, Derbyshire, is the manufacture of a range of rigid pipe assemblies and precision components for the aerospace sector. The Directors of Avingtrans (the \"Board\") believe that the Acquisition enhances the Group's aerospace components and sub-assemblies offering and the Board is pleased to take this further step in implementing the Group's strategy for aerospace. RMDG has a number of customers in common with Avingtrans, as well as several customers with whom the Company has no existing commercial relationship. The Board therefore believes that the Acquisition will both strengthen its current portfolio and also add valuable new sales channels.\nRMDG generated revenues of £3.2 million and an adjusted operating loss of £0.14 million during the year ended 31 March 2014. However, the Board believes that its potential is materially higher, when combined with the Group's other aerospace assets. The net book value of the assets and liabilities being acquired has been valued at £1.1m million, as at 31 March 2014.\nIn the current financial year, the business is expected to make a small operating loss, but to move back to break even a...