Ultra announces that it has agreed to sell its global ID business, Ultra Electronics ID, to leading mid-market private equity firm LDC, for an initial cash consideration of £22m. Additional payments of up to £3m will be made subject to earnings growth over the next two years. The proceeds will be used to reduce group indebtedness. All of the ID management team will transfer with the business. Following the divestment Ultra Electronics ID will operate as Magicard Ltd.
Based in the UK with additional sales offices in US, Dubai and China, ID designs and manufactures proprietary, instant issuance card printers and associated consumables. Its products, which include direct-to-card and reverse transfer printers, are capable of printing and encoding all types of card format. The company sells its products internationally through a broad distributor network. ID will continue to operate from its existing facilities and all employees will transfer with the business.
For the year ended 31 December 2015, the ID business had revenues of £19.3m and operating profit of £4.0m. The gross assets of the ID business at 31 December 2015 were £8.8m.
The transaction is subject to US regulatory approvals. Assuming satisfaction of all closing conditions and approvals, the transaction is expected to close towards the end of the second quarter of 2016.
Rakesh Sharma, Chief Executive of Ultra, commented:
“Over the past two years, Ultra has conducted a comprehensive review of its portfolio of businesses and capabilities, leading to the introduction of our market segment-based organisational structure. This appraisal has also allowed us to consolidate our activities, resulting in a clearer strategy for acquisition and disposal. Ultra ID is a sound and profitable business, but one that has become non-core to Ultra’s consolidated portfolio and future plans. This first significant divestment by Ultra will allow greater focus on core businesses and longer-term strategy.”
Rakesh Sharma, Chief Executive
Ami Sharma, Group Finance Director
020 8813 4307
Susan McErlain, Corporate Affairs Director
07836 522 722
James White, MHP Communications
020 3128 8756