Cohort, the independent technology group, announced the acquisition of J+S Limited, an independent systems and in-service support provider for the defence and offshore energy markets, from its shareholders for a cash consideration of £12 million.
J+S meets Cohort’s criteria for bolt-in acquisitions where it look for businesses with capabilities and/or customer relationships that are closely linked to on of its existing subsidiaries. J+S’s defence capabilities and products, notably its sonar array products, well-established manufacturing capability and long-term customer support relationships, are highly complementary to SEA’s. Cohort would expect to integrate J+S fully within SEA, leading to both cost savings and benefits from shared access to markets and technologies.
J+S’s established production capability will be able to meet SEA’s growing needs for submarine communication and other system manufacture. The acquisition of J+S will extend SEA’s reach internationally, by building on the strong foothold J+S has in Canada, Malaysia and the wider Asia Pacific region. It also brings a growing capability in adjacent markets including offshore energy.
J+S was acquired from its shareholders, comprising David Jeffries, Chairman, and a number of other former and current employees, on a cash free / debt free basis for a consideration of £12m. This will be paid using Cohort’s existing financial resources which included over £14m of net cash as at 31 August 2014 (after payment of the £6.0m initial consideration for the MCL transaction). Cohort retains unutilised banking facilities comprising an overdraft facility of £7.5m.
Andrew Thomis, Chief Executive Officer of Cohort , said:
“The acquisition of J+S represents Cohort’s second significant step forward in recent months, following the acquisition of MCL in July. By integrating J+S into SEA, we aim to accelerate the growth of the combined business by enhancing its product and service offerings and broadening its international reach. The transaction will consolidate SEA’s position as a leading international provider of naval defence technology.”