The engineering group is paying €63m for an Italian building-controls specialist as it doubles down on energy efficiency and automation.
IMI (LSE: IMI) has struck a deal to acquire iSMA Controlli, an Italian maker of intelligent building automation systems, for €63m, as the FTSE 250 engineer looks to broaden its smart-connected product range within its Climate Control division.
The target generates revenue of around €40m and operating profit of roughly €4.5m this year, according to IMI, implying a purchase price multiple of roughly 14 times current operating profit. The acquisition will be funded entirely from IMI's existing facilities rather than fresh equity or debt issuance, and is slated to complete in the fourth quarter once regulatory approvals are secured.
iSMA Controlli designs intelligent systems used to monitor and control heating, ventilation and other building functions, a market IMI believes is underserved among small and medium-sized commercial properties. Chief executive Roy Twite said the deal reinforces IMI's exposure to the 'long-term megatrends of Energy and Automation' and should help customers cut energy use and operating costs.
IMI's Climate Control arm already serves a broad base of commercial building customers, and management argues those existing relationships can be used to scale iSMA Controlli's technology more quickly than the Italian firm could achieve alone, extending IMI's reach into a fragmented part of the smart buildings market.
Completion remains subject to customary regulatory sign-off, with the fourth-quarter timeline suggesting a relatively straightforward antitrust review. Investors will be watching subsequent trading updates for early signs of revenue synergies and whether the acquired business can lift group margins once folded into the Climate Control segment.
This report is based on IMI plc’s announcement and coverage by UK Investor Magazine. Company announcements can be tracked via London Stock Exchange RNS and Investegate, and the full results calendar is worth watching for the next update.
This article is for general information only and does not constitute investment advice or a recommendation to buy or sell any security. Photo: Frederic Köberl on Unsplash.
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