Hallin Marine has acquired the entire issued share capital of Prospect Flow Solutions Ltd.
Prospect is an engineering consultancy service company to the energy sector, with a strong track record in analysis and design for subsea, offshore and onshore projects.
Prospect was formed in 1999 and employs some 40 people, based in offices in Aberdeen, Derby, Stavanger and Houston. It is established as a leading engineering solutions provider to the oil, gas and renewable energy sectors and is a specialist in computer-aided engineering.
The acquisition of Prospect gives Hallin a growing and successful subsea engineering consultancy business. It will give the Company exposure to projects at the early stage of development and, in the future, will enable Hallin to offer its clients total solution packages. Prospect will benefit from being part of a well managed and financed group and the access to Hallin’s clients, especially in the Asia Pacific region, where it is not currently represented.
The acquisition of Prospect is for an initial consideration of £3million, consisting of £1.5million in cash, financed from existing cash balances, and Hallin shares to the value of £1.5million, being 887,574 ordinary 1p shares in the Company (‘Consideration Shares’), issued at a price of 169 pence per ordinary share.
An additional consideration of up to £1,650,000 will be payable based on material growth in the financial performance of Prospect over the period to 31 December 2010.
Prospect's unaudited financial statements for the 12 months to December 31, 2007 showed turnover of £2,531,000 and operating profits of £208,000.
Prospect's Chief Executive and management team will continue to run the business and its name will not change, except to be branded as part of the Hallin group. All the senior management team have signed two year service contracts.
Following the issue of the Consideration Shares, the Company will have 41,202,574 ordinary 1p shares in issue. The Company has made application for the Consideration Shares to be admitted to trading on AIM, and dealings in the Consideration Shares are expected to commence on September 3, 2008.
Jonathan D'Arcy,Prospect's Managing Director, said, "This is an excellent deal for Prospect, its staff and its clients that will see the Company have access to Hallin's financial strength and global relationships and offices to help it achieve its ambitious growth targets."
John Giddens, Hallin's CEO, said, "This is Hallin's first acquisition and the Company took a long and detailed look at a number of subsea engineering companies before initiating talks with Prospect.
"We are delighted to welcome Prospect into the Hallin family and see the acquisition as bringing major benefits to both businesses. Prospect will benefit from Hallin’s global relationships and financial resources and Hallin will benefit from having excellent access to the specialist subsea engineering design capability.
"This will allow the Hallin group to become involved with clients' projects at an earlier stage and allow the Company to offer all its clients a wider range of services, ultimately including 'total solution' packages from design through to completion on some types of projects.
"There are obvious synergies between the two companies in terms of ultimate clients and the geographic locations where Prospect are currently based and looking to expand to. We are confident that Hallin's global strength, experience, scale and management expertise will be assets that will help Prospect grow successfully.
"Until now Hallin's rapid expansion has been solely through organic growth. Looking forward, we see further profitable expansion from both organic growth and do not rule out further acquisitions of companies that will add real value to Hallin.’
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