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Kiotech International

  • BY: Andrew Hore |
  • POSTED: 31/08/2009 |

Kiotech International is paying £3.42m to acquire animal nutrition and feed additive business Optivite Group.

The purchase price of Optivite, which has higher revenues and profits than Kiotech, is calculated on a debt free basis. The majority of the acquisition payment is in cash with 10% of it in Kiotech shares. A placing at 3p a share raises £4.75m to help finance the acquisition. Kiotech already had £1.78m in the bank at the end of June 2009.

At 5.5p a share, Kiotech is valued at £13.8m.

Kiotech supplies feed additives for aquaculture and agriculture. Kiotech developed the Ultrabite pheromone technology for fishing. Kiotech has an agreement with CEFAS (Centre for Environment, Fisheries and Aquaculture), which provides scientists for fish and oceanic research.

Optivite develops and manufactures non-hazardous, drug- free animal products that enhance feed quality. Optivite has a team of advisers to help clients improve their yields from their animals. Optivite made profits of £654,000 on revenues of £17.5m in the year to February 2009. Four-fifths of revenues are in the UK.

The enlarged group will have two-thirds of its revenues in the UK and one-third international.

Optivite chairman Richard Scragg will join the Kiotech board.

Kiotech increased its revenues by 29% to £3.47m in the six months to June 2009, while profits improved from £208,000 to £301,000. Although Kiotech’s profits are lower than Optivite, its margins are much higher. 

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