IMI Plc to acquire Heatmiser UK for an enterprise value of £110 million

LONDON, UK: IMI plc announced the proposed acquisition of Heatmiser UK Ltd for an enterprise value of £110 million, with up to a further £8 million based on Heatmiser’s future financial performance. Heatmiser will become part of IMI Hydronic Engineering.

The proposed acquisition of Heatmiser UK is fully aligned with IMI’s strategy and purpose of [Breakthrough Engineering for a better world and represents an opportunity to accelerate our growth in smart buildings.

Adjacent to IMI Hydronic’s existing HVAC product offerings, Heatmiser will provide an attractive entry point into connected residential thermostatic control, a fast-growing market where Heatmiser is already a UK leader.

There are also significant opportunities to leverage IMI Hydronic’s strong brand and market presence to scale Heatmiser’s offering across Europe, as well as leverage Heatmiser’s proven connected technology capabilities across existing and new IMI products.

The demand for smart temperature controls is growing rapidly and is expected to accelerate further, with more than 200 million buildings in Europe requiring renovation to upgrade their heating and cooling systems over the next 30 years, to comply with energy efficiency and environmental legislation.

In the financial year to December 2022, Heatmiser is expected to generate revenues of c.£22.5m. The headline enterprise value represents c.12x 2022 estimated adjusted EBITDA. Closing is expected before year end, subject to normal filings.

Heatmiser is one of the UK’s leading smart thermostatic control manufacturers for radiant systems, enabling homeowners to accurately control heating and cooling in each room remotely. The company’s success is based on its portfolio of high-quality products, strong customer relationships, digitalised commercial model and great technical support for their customers.

Heatmiser was founded by Gordon Kay in 1968 in Blackburn, UK, to develop thermostatic control products for residential buildings. Since then, the company has leveraged technological advancements to become a leading manufacturer of smart thermostats for radiant underfloor systems in the UK, with strong recognition by both installers and end-users.

Heatmiser is currently managed by Martyn and Sarah Kay, who will remain in the business and continue to manage it as part of IMI Hydronic.

Commenting on the acquisition, Roy Twite, Chief Executive of IMI Plc, said: “I am really pleased to announce the acquisition of Heatmiser, which is fully aligned to IMI’s strategy of delivering significant shareholder value by solving industry problems and putting customers at the heart of what we do. This is an important, strategic entry point to the rapidly growing connected controls market that will accelerate our organic growth across IMI Hydronic.

There has never been more urgency to deliver energy efficiency and comfort in buildings, and Heatmiser is a leader in this space. I want to personally thank the Kay family for their commitment to the transaction and welcome the entire Heatmiser team into IMI.”

Phil Clifton, Divisional Managing Director of IMI Hydronic Engineering, commented: “I am very excited about the possibilities that Heatmiser provides for our division and its potential to provide significant energy efficiencies for our customers. Helping our customers save energy is key to our Better World purpose.

The business has a fantastic range of smart products, a leading position in the UK and a highly innovative and recognised proposition for its customers. We are all looking forward to working with Martyn & Sarah Kay and the entire Heatmiser team to grow the business jointly in the coming years.”

Martyn Kay and Sarah Kay, Heatmiser UK Ltd Directors, added: “We feel very proud of the business we have created at Heatmiser and we want to say a big thank you to our team for helping us achieve a market leading position.

By listening to our customers and reacting to market change, we have become one of the UK’s leading HVAC control brands and we are excited about joining the IMI family and the opportunities this will bring. We are particularly excited about the growth potential of the business in new territories and our joint vision of creating a better more energy efficient world.”