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Ashtead Technology Holdings PLC on Tuesday said it acquired the entire share capital of equipment rental and maintenance firm Hiretech Ltd.
The Aberdeenshire-based subsea equipment rental firm acquired Aberdeen, Scotland-based Hiretech for £20 million on a cash and debt free basis.
To fund the acquisition, Ashtead Technology increased its revolving credit facility by £20 million with its existing banking partners, bringing the group’s total revolving credit facility to £60 million.
This is up from the £40 million facility that was put in place at the company’s initial public offering last year. Shares in Ashtead Technology started trading on the Alternative Investment Market in November 2021.
Ashtead Technology said Hiretech recorded revenues of £6.5 million in the year that ended October 2022, and earnings before interest, taxes, depreciation, and amortisation was £4.1 million.
Ashtead Technology added that it expects the acquisition to result in double-digit earnings accretion in financial 2023 and to generate returns in excess of the group’s cost of capital in the first full year of ownership. Ashtead Technology’s earnings per share was 13.2 pence in 2021.
The acquisition marks Ashtead Technology’s seventh acquisition in the last five years. The company plans to leverage Hiretech’s offshore renewables and decommissioning-focused support services offering meet growing global customer demand, Ashtead Technology said.
‘This acquisition provides strong synergies through vertical integration of the supply chain, and meaningfully expands our business by adding complementary capabilities to strengthen our mechanical solutions service line and deliver an enhanced offering to our customers,’ Ashtead Technology Chief Executive Allan Pirie said.
Ashtead Technology shares were up 7.4% to 336.30 pence on Tuesday morning in London.
By Jaskeet Briah, Alliance News reporter
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