LONDON: Midwich Group Plc has acquired the entire issued share capital of Starin Marketing, a specialist value-add audio visual (AV) distributor in the US for an enterprise value of up to $46.1 million (£35.7m), consisting of a $27.1 million (£21.0m) cash consideration and an assumption of up to $19.0 million (£14.7m) in existing debt facilities.

Midwich is a specialist audio visual (“AV”) distributor to the trade market with operations across the UK and Ireland, Continental Europe and Asia Pacific.

In conjunction with the Acquisition, the Group announces its intention to raise gross proceeds of £39.7 million via an accelerated bookbuild.

The net proceeds of the Placing will be used to repay the Group’s debt facilities which were drawn down to fund the Acquisition and to provide additional resources to fund further acquisitions that the Group is pursuing in the short term. The Group expects to deploy the majority of the proceeds in the current financial year.

The Acquisition is expected to be modestly earnings accretive in the current financial year, including the impact of the total proposed fundraise, with future acquisitions expected to add further accretion.

Stephen Fenby, Managing Director of Midwich Group plc, commented: “The acquisition of Starin Marketing, Inc. is a significant day in Midwich Group’s history, marking our entry into North America, the largest AV market in the world. Starin’s exposure to, and relationships in, the growing unified communications segment will be greatly beneficial to Midwich as it seeks to increase revenues in this fast growing AV sub sector across its global network. The highly experienced management team has built a great business and I look forward to welcoming them and the wider team into the Midwich Group.

Outside of the acquisition, 2019 was another year of good growth for Midwich, despite negative sentiment in the global economy. The Group delivered a robust organic performance from existing businesses and significant contributions from the acquisitions made throughout 2018 and 2019. We have been pleased with the integration of the four businesses acquired during 2019 which have enhanced both our geographic and product coverage and are all trading to plan.”

Edited by Nayyar Iqbal