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Advanced Power Components
- BY: Andrew Hore |
- POSTED: 15/04/2008 |
Electronic components distributor Advanced Power Components is buying microwave components distributor Novacom Microwave.
This deal will significantly increase both the revenues and profits of APC.
APC will pay up to £1.6m in cash. The initial payment is £1.1m, of which £600,000 is payable on completion and the rest in six equal instalments over 18 months. There could be a further £500,000 paid depending on Novacom’s performance in its first 12 months under APC’s ownership. This means that part of the cost should be paid by Novoacom’s own cash flow.
Novacom, which distributes radio frequency and microwave components, has a similar business model to APC. The components it sells are designed-in to equipment at an early stage. There are also opportunities for cross-selling to the enlarged group’s defence and communications customers.
In 2007, Novacom made profits of £220,000 on revenues of £2.3m. APC has stated that its revenues will be around £4.7m in the year to February 2008, while its profits will be approximately £210,000 – similar to the previous year.
APC’s shares were unchanged at 19p, which capitalises the company at £3.84m.
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