discoverIE Group - High-margin sensor technology acquisition
discoverIE has announced the acquisition of Sens-Tech for an initial cash consideration of £58m, partially funded by a £33m placing at 415p per share. Sens-Tech designs and manufactures specialist sensing technology and fits with discoverIE’s strategy to buy businesses supplying niche, highly customised products for critical applications. The business increases the group’s international revenues and boosts its presence in target markets such as transportation and healthcare. This is discoverIE’s largest acquisition since Noratel in FY15; we estimate the deal is immediately earnings enhancing (FY20e EPS +2%, FY21e +5%).discoverIE Group designs, manufactures and supplies electronic products, supplying customers in the transportation, medical, renewable energy and industrial sectors. Co.'s business is focused in five technology areas, which include communication and sensors, imaging and photonics, power and magnetics, microsystems, and electromechanical and cabling. Co. operates across two divisions: Design & Manufacturing, which supplies custom electronic products which are designed or modified from an existing product to customer specifications; and Custom Distribution, which provides technically demanding, customized electronic, photonic and medical products to industrial manufacturers.
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