Midwich enters US market with Starin acquisition

The total consideration consists of $27.1m (£21.0m) in cash and an assumption of up to $19.0m (£14.7m) in existing debt facilities.

Midwich said the deal represents a significant strategic investment to enter North America, which is the world's largest AV market, and will also provide extended geographical support to its global customers.

The AIM-listed company said it was planning to raise gross proceeds of £39.7m via an accelerated bookbuild. The proceeds will be used to repay its debt facilities which were drawn down to fund the acquisition and to provide additional resources to fund further acquisitions being pursued in the short term. The majority of the proceeds are expected to be deployed in the current financial year.

Managing director Stephen Fenby said: "Starin's exposure to, and relationships in, the growing unified communications segment will be greatly beneficial to Midwich as it seeks to increase revenues in this fast growing AV sub sector across its global network. The highly experienced management team has built a great business and I look forward to welcoming them and the wider team into the Midwich Group."

Acquisition aside, Fenby said 2019 had been "another year of good growth" for the company despite negative sentiment in the global economy.

"The group delivered a robust organic performance from existing businesses and significant contributions from the acquisitions made throughout 2018 and 2019. We have been pleased with the integration of the four businesses acquired during 2019 which have enhanced both our geographic and product coverage and are all trading to plan," he said.

At 0915 GMT, the shares were down 0.5% at 531.40p.