Oxford Instruments to sell division to Hitachi High-Technologies

High technology solutions, information and services provider Oxford Instruments announced on Wednesday that it had agreed to sell its Industrial Analysis business to Hitachi High-Technologies Corporation (HHT) for a consideration of £80m on a cash and debt free basis.

The London-listed firm said HHT would acquire the companies, assets and liabilities that comprised the Industrial Analysis business.

Its board described the Industrial Analysis business as a “leading global provider of handheld and bench-top instruments” using x-ray fluorescence (XRF), laser induced breakdown spectroscopy (LIBS) and optical emission spectroscopy (OES) technologies for analysing materials in a broad range of industrial applications.

Headquartered in Oxford, the Industrial Analysis business had research and development and assembly operations in Finland, Germany and China and sales and support operations in a number of countries around the world, the board added.

The transaction remained subject to regulatory approval in Austria, confirmation of receipt by the relevant regulator of the share transfer filing in China, and completion of a pre-sale reorganisation to carve out the relevant businesses.

Assuming satisfaction of those conditions, the transaction was expected to close in the second quarter of the 2018 fiscal year, Oxford’s board confirmed.

Proceeds would be used to reduce existing borrowings, and the current Industrial Analysis management team would transfer with the business.

In the financial year to 31 March 2016, the Industrial Analysis business had revenue of £49.5m, adjusted operating profit of £3.3m and normalised business level adjusted EBITDA of £8.2m.

Its gross assets at 30 September 2016 were £35.6m.

“The sale of the Industrial Analysis business follows the continued strategic review of our portfolio and is a key element in the ongoing transformation of Oxford Instruments,” said Oxford Instruments chief executive Ian Barkshire.

“I am confident that our Industrial Analysis business can look forward to a bright future as part of Hitachi High-Technologies.

“This transaction creates a more focussed NanoTechnology Tools and Service business with some improvement to operating margin and will bring net debt to EBITDA leverage after completion to below one times on a pro-forma basis for the year ended 31 March 2017.”

Toshiyuki Ikeda, senior vice president of Hitachi High-Technologies Corporation, said his company intended to “contribute to society” by strengthening the product range, providing safe and secure solutions for the environmental, food safety and security sectors.

“We look forward to a smooth integration of the business and welcome the employees of Industrial Analysis to HHT.”