Spectris shares were up 4.8% to 2,637p in early morning trading on Tuesday, after the precision instruments company reported its divestment of Omega Engineering and its £300 million share buyback scheme.
Spectris is set to sell Omega Engineering to Arcline Investment Management for £403 million, which reportedly amounts to a valuation of approximately 20.4 times Omega’s adjusted EBITDA for 2021.
Arcline confirmed that Omega will join its Dwyer Group portfolio of companies once the agreement has closed, citing interest in the group’s production of specialist sensors for Dwyer’s development of innovative sensors and instrumentation solutions for the environmental and building automation markets.
Omega reportedly generated sales of £129 million in 2021, with an adjusted EBITDA of £19.7 million and a gross assets book value of £197.7 million.
The deal is currently projected for completion early in the third quarter of 2022.
Spectris confirmed that sale of Omega Engineering will leave the firm with Malvern Panalytical, HBK and Industrial Solutions as its three core businesses.
The company said that the divestment would leave Spectris with an improved financial profile, with a specific focus on high precision measurement instruments.
“Spectris today is a more focused, more profitable, and more resilient business, underpinned by a very strong balance sheet,” said Spectris CEO Andrew Heath.
“We are more aligned than ever to end markets with attractive growth trajectories, supported by key sustainability themes.”
“The divestment of Omega will further improve our financial profile.”
Spectris also confirmed the launch of its £300 million share buyback scheme, which will see the group kick off an initial tranche of £150 million, followed by an additional tranche of £150 million to be launched pending shareholder approval at the firm’s Annual General Meeting on 27 May 2022.
“Today’s announcement is yet a further example of our approach to optimising our assets and successfully divesting businesses at multiples higher than the Group as a whole,” said Heath.
“This disposal, in conjunction with the share buyback programme, delivers clear value for shareholders, whilst also allowing us to take advantage of new growth opportunities for our core businesses, in line with our purpose.”
