Cohort has agreed to acquire Empresa de Investigação e Desenvolvimento de Electrónica, S.A., (EID), a Portugal based supplier of advanced electronics, communications and command and control products and systems for the global defense market.
EID is a hi-tech company with more than 30 years’ experience in the design, manufacture and support of advanced, high performance command, control and communications equipment for the global defense and security market. Customers for its naval communications systems include the Royal Navy and other NATO navies including those of Portugal, the Netherlands, Spain and Belgium. It has also supplied a number of other export customers; in total its products equip over 120 warships worldwide, and its army products have also enjoyed wide domestic and export success.
EID operates through three market-facing divisions: Naval Communications: Integrated command, control and communications systems for warships; Tactical Communications: Radio equipment, vehicle intercom systems and networking equipment: and Communications Systems: Field communications equipment, military messaging and turn-key integrated command, control, communication and surveillance systems.
EID generated revenue in the year to December 2014 of €14.5 million and EBIT of €1.4 million. Gross Assets as at 31 December 2014 were €25.5 million. The company believes its strong order book (€35.2 million at 31 March 2015) and prospects position it well to make progress in 2015 and beyond. At the end of March 2015, €12.4 million of revenue for the year ending 31 December 2015 was already on order, supplemented by a promising pipeline of further sales prospects.
Cohort’s Board believes that further investment in carefully targeted acquisitions will generate enhanced returns to shareholders. The Group seeks to acquire agile, innovative businesses operating in the defense and security sectors with growth potential and a degree of sustainable competitive advantage. EID meets all of these criteria. Completion of the acquisition is subject to approval by the Portuguese ministries of finance and defense, and on the fulfillment of certain other conditions. It is likely that the acquisition will complete in September 2015.
Andrew Thomis, Chief Executive of Cohort, said: “The acquisition of EID is an important step for Cohort. It adds to the Group a highly capable provider of communications systems that has demonstrated the quality of its products through export success in a number of important territories.
“EID has a strong order book and excellent prospects with both domestic and export customers. As Cohort’s first non-UK company it brings us a new domestic market – and the opportunity to offer all of the enlarged Group’s products and services to the existing customers of both EID and Cohort. I am looking forward to working with EID’s management team to realize the exciting growth opportunities that this transaction will create.”