Eurotech S.p.A, a provider of Edge Computing solutions for mission critical applications, is pleased to announce that it has successfully finalized, concurrently with the signing of the related binding agreement, the acquisition from InoNet GmbH of the entire share capital of InoNet Computer GmbH (“InoNet“), a German company based in Taufkirchen (south of Munich), operating in the sectors of Industrial PCs (IPCs) and embedded systems for special applications.
The Enterprise Value of the target amounts to Euro 10 million, on the basis of which a cash consideration of Euro 9.45 million has been determined; there is also an earn-out of up to a maximum of 300,000 Eurotech shares, to be paid depending on the achievement until the year 2024 of specific targets for organic growth, implementation of synergies and retention of identified key figures. The aforementioned cash amount of the acquisition consideration was paid in full using the Eurotech Group’s cash and cash equivalents.
Also Read: TrewUp Launches Deduction Management Software
Founded in 1998, InoNet is an established and recognized player in the DACH market, where it supplies custom and configured systems to renowned customers in the medical, industrial, and automotive sectors. For fiscal year 2022, ending March 31, 2023, InoNet expects revenues of €17.5 million (€15.2 million in fiscal year 2021) and EBITDA of €0.7 million (€0.4 million in fiscal year 2021), calculated according to German GAAP. This corresponds, according to IFRS used by Eurotech and based on preliminary estimates, to approximately €0.8 – 0.85 million.
The implied multiple of the transaction is 0.6x with respect to sales and 14.3x with respect to EBITDA (11.8x – 12.5x with respect to EBITDA calculated according to IFRS).
We expect to be able to bring InoNet’s EBITDA margin into double digits within the next two and a half years. We have identified, on the one hand, cost synergies on the supply chain and, on the other hand, growth synergies related to cross-selling actions, both to InoNet’s existing customers and to new customers in the DACH area.