Scientific Digital Imaging (SDI.L AIM All Share, Market Cap Â£46m, 46.75p, 2.8% of JIC Portfolio and 0.0% of JIC Top 10)
Conclusion: A copy book acquisition for SDI. It fits its criteria of acquiring complementary businesses in niche segments of the scientific and instrumentation sector. The acquisition cost also falls within its desired range of 4-6x earnings before interest and tax. I am in SDI because I like its strategy and expect to see many more of these types of complemetary and value enhancing dealsÂ to come.Â Â On current forecasts the shares are valued at 14.8x the year ending April 2020, for 24% growth. That looks good value to me, and I am glad I added on 22ndMarch, although my timing could have been a little better. Happy Holder!
SDI announced the acquisition of MPB Industries for Â£1.586m.
MPB designs and manufactures flowmeters and process control instrumentation with applications in water treatment, oil and gas production, medical anaesthesia, scientific analysis and many other areas. It will join SDIâ€™s Sensors & Control operating segment.
In the year ended 31stDecember 2018, MPB achieved revenues of Â£1.9m, gross profit of Â£1.28m and profit before interest and tax of Â£0.31m.
The acquisition is expected to be earnings enhancing in SDIâ€™s financial year ending 30thApril 2020.
Ken Ford, Chairman of SDI said:
“We are delighted to welcome MPB into the SDI family. MPB’s flowmeters are recognised for their quality across a broad set of end markets, and their technology and applications nicely complement those of other businesses in our Sensors & Control segment. MPB is SDI’s fourth significant acquisition in this financial year which has seen the Group expand across its two principal operating segments and highlights our position as an acquirer of choice in our sector.”