Acquisitions

Addtech is constantly on the lookout for companies to acquire and is engaged in discussions with a number of possible companies. During this financial year Addtech made nine acquisitions that came into effect during the year. Five companies were acquired in the previous year. The year's acquisitions were carried out in all business areas and are diverse both in terms of the markets and products covered.

Our three main reasons for acquisitions are so that our:

• Subsidiaries can make small-scale bolt-on acquisitions in order to reinforce existing operations in their niche.
• Business units can expand and build market and/or product positions in selected market segments.
• Business areas can add new market segments in the areas where we see the right conditions for being able to become market leaders.

Since becoming a listed company in 2001, Addtech has acquired around 90 companies. The following companies were acquired during the year:

• GigaCom AB. On 1 April GigaCom AB and GigaCom AS were acquired to become part of the Components business area. The GigaCom companies are technology trading companies that provide fiber optic components and systems in the Swedish and Norwegian markets. The companies have 6 employees and sales of about SEK 30 million.
• Solar Supply Sweden AB. Solar Supply Sweden AB was acquired on 5 May to join the Energy business area. Solar Supply is a technology trading company that markets and installs solar cell systems with related components in the Swedish market. Solar Supply has 3 employees and sales of about SEK 15 million.
• Hans Følsgaard A/S. On 1 July Addtech acquired 90 percent of shares outstanding in Hans Følsgaard A/S to become part of business areas Components and Energy. Hans Følsgaard is a technology trading company that delivers components and systems to OEM customers and larger end users within the manufacturing industry and also products within infrastracture and power transmissions to e.g. electric producers and wind power manufacturers. Hans Følsgaard has 65 employees and sales of about DKK 300 million.
• Frameco AB. Frameco AB was acquired on 1 July to join the Industrial Solutions business area. Frameco is a technology trading company that delivers ergonomic armrest solutions mainly to construction equipment and buses. Frameco has 5 employees and sales of about SEK 10 million. 
• Tampereen Sähköpalvelu Oy. On 4 July Tampereen Sähköpalvelu Oy (TSP) were acquired to become part of the Energy business area. TSP is a technology trading company that markets and sells components for electrical installations to OEM customers mainly on the Finnish market. TSP has 25 employees and sales of about EUR 7,5 million.
• Flow-Teknikk AS. On 1 August Flow-Teknikk AS were acquired to become part of the Life Science business area. Flow-Teknikk is a technology trading company that markets process instrumentation to the industry, research and offshore markets in Norway. Flow-Teknikk has six employees and sales of around NOK 30 million.
• Amestec Oy. Amestec Oy was acquired on 1 September to join the Components business area. Amestec is a technology trading company that sells portable measuring instruments and data loggers to industry and the public sector. Amestec has two employees and sales of about EUR 0,5 million.
• Scandinavian Friction AB. On 29 September Scandinavian Friction AB were acquired to become part of the Industrial Solutions business area. Scandinavian Friction AB is a technology trading company that markets high-, as well as low friction components to the industry. Scandinavian Friction has three employees and sales of about SEK 15 million.
• Celltech China Ltd. On 5 February Addtech acquired 51 percent of shares outstanding in Celltech China Ltd, Hong Kong, to become part of the Energy business area. Celltech China manufactures battery pack to the group companies in the business unit Storage & Power. The Company has 25 employees and sales of about SEK 20 million.

The total purchase consideration for the year's five acquisitions was SEK 341 million.

The combined effect of the acquisitions on the Addtech Group's net sales was SEK 465 million, on operating profit SEK 23 million and on profit after tax for the period SEK 14 million. If the acquisitions had taken place at 1 April 2014, they would have had an effect of an estimated SEK 611 million on consolidated net sales, about SEK 34 million on operating profit and about SEK 22 million on profit after tax for the year. The acquisitions were made using an average EV/EBIT multiple of about 5. The number of Addtech employees increased by 140 people as a result of the year's acquisitions.