Gulf Oil and Gas accountACCOUNT

CUI Global to Acquire Orbital-UK for Ł17.0 Million

Source: www.gulfoilandgas.com 3/5/2013, Location: Europe

CUI Global, Inc., a platform company dedicated to the acquisition, development, and commercialization of new, innovative technologies, announced it has signed a Shareholder Purchase Agreement (SPA) to acquire 100% of the capital stock of Orbital Gas Systems Limited (Orbital-UK), a United Kingdom-based provider of natural gas infra-structure and advanced technology, including metering, odorization, remote telemetry units (RTU) and a diverse range of personalized gas engineering solutions to the gas utilities, power generation, emissions, manufacturing and automotive industries.

Effective upon completion of the acquisition, Orbital-UK will become a wholly owned subsidiary of CUI Global. Andrew Ridge will continue as the managing director of Orbital-UK. William Clough will remain as president and CEO of CUI Global, and assume the role of CEO of Orbital-UK. CUI Global does not expect any organizational changes to Orbital-UK’s operations in the United Kingdom or elsewhere.

“We believe the acquisition offers significant synergies for revenue growth. Orbital-UK’s internationally recognized expertise in the natural gas industry, including bringing together the patented VE-technology with the Vergence device from CUI Global offer natural gas operators/users a comprehensive solution set for the next generation of energy metering systems,” stated William Clough, CUI Global’s president & CEO.

While the Vergence Technology allows the natural gas operator to quickly and accurately obtain Calorific Value (CV), Wobbe Index (WI), Relative Density (RD), and Compression Factor (Z) in less than three seconds; that analysis takes place after an 8 to 10 minute delay in capturing the natural gas sample from the pipeline. The patented VE-Probe, on the other hand, allows the sample to be obtained from the pipeline in less than two seconds.

Combining the two technologies, allows for a packaged device that provides the natural gas operator/user a complete energy analysis (from sample to results) in less than five (5) seconds – a process that now takes from 12 to as much as 40 minutes – giving the operator the ability to obtain almost “real-time” results simply unavailable from any other current technologies.

In addition, Orbital-UK’s in-house engineering capabilities, manufacturing relationships, and R&D infrastructure are expected to accelerate the adoption of the Vergence device, while allowing the company to control all calibration, packaging, delivery, engineering support and more within the Orbital-UK facilities; thus allowing CUI Global to capture an even larger percentage of operating margins from the final, packaged device. Anticipated cost synergies include leveraging existing sales and distribution infrastructure for cross-selling opportunities.

The acquisition will also immediately add significant revenues and earnings to CUI Global. The SPA calls for purchase of all of the outstanding shares in Orbital-UK and its subsidiary for a gross purchase price of Ł17.0 million. The transaction is expected to close by April 30, 2013, subject to customary closing conditions, including regulatory approval. The purchase is to be funded in part by a future equity offering and available cash resources.

Orbital-UK’s unaudited historical results for calendar year 2012 show that it produced net income of approximately $3.1 million on gross revenues in excess of $23.0 million. An unaudited pro forma condensed combined statement of operations for FY 2012 results in net earnings of $511,399 or $0.03 earnings per share (EPS) on gross revenues of more than $63.9 million.

With Orbital-UK’s capabilities, reputation, and extensive contacts throughout the natural gas industry, this acquisition allows CUI Global to speed up and enhance the development and adoption of its proprietary Vergence Technology. In addition, Orbital-UK will be working to rapidly bring its natural gas product line to a broader international market using CUI Global’s market partners and global distribution capabilities.

“This transaction effectively positions CUI Global for even more accelerated growth,” explained Clough. “Orbital-UK’s talent base of technical employees and their world-class engineering and support team, not to mention their sterling reputation within the natural gas industry, will enable us to speed market adoption of our Vergence GasPT2 device; while CUI Global’s established network of global distributors will allow Orbital-UK to market its broad portfolio of natural gas products to a much larger audience.”

“This is a very significant company milestone for Orbital,” explained Orbital-UK’s managing director, Andy Ridge. “With the combination of these two companies we will now be able to expand our programs and services for our existing customer base, as well as pursue growth opportunities across a much broader market. As part of a global entity, we expect enhanced visibility in the market and heightened awareness for our company offerings. Further, the addition of the Vergence GasPT2 technology to our current product line is expected to increase our ability to penetrate new markets and thereby grow our core business.”

Since it was formed in 1984, Orbital-UK has focused its attention on providing superior customer service, advanced technology solutions and a dedication to product quality unequaled in the natural gas industry. Orbital-UK’s customers, including National Grid (the national gas transmission company for the UK), all of the UK's Gas distribution networks, and others such as Jaguar Motor Cars, BMW, and more, have come to rely on its team of talented and knowledgeable employees for crucial engineering support and specialized knowledge. Its value-added services and innovative products reduce the time it takes to identify, design and begin cost effective delivery of new technology to the natural gas and other industries.

“The acquisition of Orbital-UK, with the associated increase in revenues and earnings, and the dramatic increase in our ability to penetrate the natural gas market, while capturing even more operational margin, all combine to further our strategy of making opportunistic, synergistic acquisitions of either technology, personnel, or companies that will increase our growth and, thereby, enhance our shareholder value – this transaction certainly encapsulates all of those positive elements,” Clough concluded.

Mergers and Acquisitions News in United Kingdom >>

Norway >>  12/9/2019 - Zenith Energy Ltd., has decided to discontinue its plans to acquire a Norwegian oil & gas company, Nordic Petroleum AS ("Nordic"), by way of an exchan...
Japan >>  11/25/2019 - Mitsubishi Corporation (MC) and Chubu Electric Power Co., Inc. (Chubu) have been selected as the preferred buyers in a bid for the Dutch Energy Compan...

Norway >>  11/25/2019 - Reference is made to press release dated 28 October 2019, in which Prosafe informed that the Norwegian Competition Authority had issued a Statement of...
United Arab Emirates >>  11/25/2019 - Royal Boskalis Westminster N.V. (Boskalis) has acquired the remaining 37.5% in the Horizon Group (Horizon). Earlier this year, Boskalis already acquir...

Russia >>  11/22/2019 - Gazprom Gazoraspredeleniye, a company controlled by Gazprom, successfully completed the sale of 850,590,751 ordinary shares of Gazprom (3.59 per cent ...
Oman >>  11/20/2019 - Shaleem Petroleum Company today signed an agreement to acquire Weatherford International - Oman. This included the relocation of all business and equ...

Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


United Kingdom Oil & Gas 1 >>  2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 | 28 | 29 | 30 | 31 | 32 | 33 | 34 |

More News

Related Links

Gulf Oil and Gas
Copyright © 2019 Universal Solutions All rights reserved. - Terms of Service - Privacy Policy.