LONDON: Amcomri Group plc (AIM: AMCO), the United Kingdom-focused specialist in engineering services and industrial manufacturing, has successfully acquired EMC Elite Engineering Services Ltd (“EMC”), a niche provider of mechanical and electrical engineering services for power generation, process, and aggregate industries.
The acquisition, finalized with an initial cash consideration of £2.5 million, marks a strategic move in expanding Amcomri’s industrial capabilities.
The remaining balance for the acquisition involves deferred payments totaling £1.5 million, distributed over three years, alongside an earn-out agreement based on EMC’s future financial performance.
Industry Reputation and Growth Potential
EMC has established itself as a reliable sector leader with an experienced workforce and a strong financial track record. Known for its maintenance and project-based services in critical industries, EMC has cultivated a loyal customer base driven by regulatory requirements and planned maintenance needs. Its expertise in rotating equipment maintenance and renewable energy storage systems aligns with Amcomri’s industrial strategy.
Amcomri anticipates synergy opportunities by integrating EMC’s capabilities with its high voltage engineering services business, WJ Project Services, while exploring expansion into adjacent industrial markets. EMC’s expertise promises significant contributions to Amcomri’s Embedded Engineering Division.
Financial Performance and Prospects
EMC reported revenues of £5.7 million and pre-tax profits of £0.9 million for the fiscal year ending August 31, 2024. With net assets valued at £1.6 million, EMC’s operational cash flow remains strong, presenting promising growth opportunities.
Terms of the Acquisition
Under the share purchase agreement, the sellers, Jamie Herbert, Michelle Herbert, David Lewis, and Andrea Lewis, will retain a vested interest through a structured earn-out agreement. Amcomri has capped annual payments under the earn-out scheme at £280,000 for each of the next three years. Notably, all EMC employees will remain employed following the acquisition, ensuring continuity and fostering collaboration.
Hugh Whitcomb, Co-Founder and CEO of Amcomri, emphasized the importance of this acquisition. “We are delighted to confirm EMC as our first acquisition since our AIM admission in December last year,” Whitcomb stated. “EMC’s outstanding team and reputation will significantly enhance our Embedded Engineering capability and technical services going forward. We look forward to working together on growth opportunities.”
Whitcomb also highlighted the company’s broader strategy and shared optimism for the fiscal year. A trading update for the financial year ended December 31, 2024, is expected next month.
The acquisition reflects Amcomri’s “Buy, Improve, Build” philosophy, reinforcing its position as a leading player in engineering services while paving the way for further innovations in renewable energy technologies.