CAMBRIDGE, ON, Dec. 19, 2018 /CNW/ - ATS Automation Tooling
Systems Inc. (TSX: ATA) ("ATS" or the "Company"), an
industry-leading automation solutions provider, today announced it
has entered into a definitive agreement to acquire Comecer S.p.A.
("Comecer"), a leader in the design, engineering, manufacture and
servicing of advanced aseptic containment and processing systems
for the nuclear medicine and pharmaceutical industries.
"Comecer is a proven, high-quality business that brings new and
complementary capabilities, customer relationships and specialized
talent to ATS," said Andrew Hider,
CEO of ATS. "Its addition will strengthen our customer offering in
both pharma and biopharma, while adding an innovative new platform
in radiopharmaceuticals. These are growing markets with desirable
characteristics including stringent quality standards and
regulations and where there is a high consequence of failure. We
look forward to welcoming Comecer to the ATS family."
Comecer generates approximately 55% of its annual sales to
customers in the radiopharmaceutical market, where it supplies
specialized radiation shielding systems used by customers in the
production, handling, and dispensing of radiopharmaceutical drugs.
Applications for this type of equipment include the diagnosis and
therapeutic treatment of a number of conditions including various
forms of cancer and cardiovascular disorders. The balance of
Comecer's sales are derived from equipment to support the aseptic
processing, filling and handling of specialized pharmaceuticals as
well as isolator and incubator equipment used in advanced therapy
medicinal production (ATMP), a regenerative cell therapy that uses
patient cells to grow new tissues.
Comecer was established in 1974, and today has approximately 320
skilled employees, the majority of whom work at its main production
site in Castel-Bolognese, Italy.
The main production site is the home of Comecer's research and
development centre. Comecer also has a technical and assembly
centre in Joure, Netherlands, and
sales and service offices in North
America, Europe and
Asia.
The total cash purchase price for the acquisition will be
113 million Euro, subject to working
capital and other adjustments. The Company will fund the
acquisition primarily from cash on hand and its credit facilities.
The transaction is expected to close in the first calendar quarter
of 2019, subject to customary closing conditions.
For the 2018 calendar year, Comecer is expected to generate
revenues of approximately 67 million
Euro, with a low double-digit EBITDA margin. In fiscal 2020
(period beginning April 1, 2019), ATS
expects adjusted earnings per share accretion in the mid-single
digit percentage range as a result of the transaction. Earnings per
share are expected to be diluted in the short-term due to the
incremental amortization of Order Backlog and other intangible
assets as a result of business combination accounting adjustments.
Excluding the impact of business combination accounting, the
Company expects the return on invested capital associated with this
acquisition to achieve double digits by year five
post-acquisition.
Integration of Comecer will target revenue synergies and will
include the deployment of the ATS Business Model (ABM) which is
expected to enable improvements in project management, operations,
supply chain management and product life cycle management.
Comecer will continue to be led by its CEO, Alessia Zanelli. "We are very pleased to be
joining ATS to continue the next phase of Comecer's growth," said
Ms. Zanelli. "By combining ATS and Comecer, we will create a
premier player in the radiopharma, pharma and ATMP markets. This
will be a tremendous benefit to our customers and a great
opportunity for our talented employees. This agreement confirms the
potential of our capabilities and will enhance our globally
recognized 'made-in-Italy'
expertise."
Conference Call and Webcast
At 11:00 a.m. eastern on Wednesday, December 19, 2018, the Company will
host a conference call and webcast with slides to discuss the
transaction with a follow-up question and answer period with
analysts.
The listen-only webcast can be accessed live at
www.atsautomation.com. The conference call can be accessed live by
dialing (647) 427-7450 ten minutes prior. A copy of the slides
accompanying management's remarks are available on the Company's
website under Investor Relations – Events.
A replay of the conference call will be available on the ATS
website following the call. Alternatively, a telephone
recording of the conference call will be available for one week
(until December 26, 2018) by dialing
(416) 849-0833 and entering the passcode 5491177 followed by number
sign.
About ATS
ATS is an industry-leading automation
solutions provider to many of the world's most successful
companies. ATS uses its extensive knowledge base and global
capabilities in custom automation, repeat automation, automation
products and value-added services, including pre-automation and
after-sales services, to address the sophisticated manufacturing
automation systems and service needs of multinational customers in
markets such as life sciences, chemicals, consumer products,
electronics, food, beverage, transportation, energy, and oil and
gas. Founded in 1978, ATS employs approximately 3,900 people at 21
manufacturing facilities and over 50 offices in North America, Europe, Southeast
Asia and China. The
Company's shares are traded on the Toronto Stock Exchange under the
symbol ATA. Visit the Company's website at
www.atsautomation.com.
About Comecer
Comecer is a developer and
manufacturer of high-tech systems in the field of Aseptic
Processing and Containment for the Pharmaceutical and Nuclear
Medicine Industries, specializing in isolation technology solutions
for regenerative medicine and tissue engineering. Comecer's
products are used worldwide by hospitals, universities, research
institutes, pharma companies and large industrial groups. The
majority shareholder of Comecer is represented by Ms. Zanelli,
while Principia SGR, through its Principia III – Health fund,
investing in SME's and late stage startup in the healthcare field,
owns a minority share of the group. Principia acquired 45% of
Comecer at the end of 2015 to support the company in developing the
integrated and advanced therapy production. Further information is
available from www.comecer.com.
Note to Readers:
Non-IFRS measures:
This news release uses the
non-IFRS measures EBITDA, EBITDA margin, adjusted earnings per
share, Order Backlog, and return on invested capital associated
with this investment. These terms do not have any standardized
meanings prescribed within IFRS and therefore may not be comparable
to similar measures presented by other companies. These measures
should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. EBITDA is
defined as earnings from operations excluding depreciation and
amortization (which includes amortization of intangible assets).
EBITDA margin is an expression of an entity's EBITDA as a
percentage of revenues. EBITDA is used by the Company to evaluate
the performance of operations. Management believes that EBITDA is
an important indicator of ability to generate operating cash flows
to fund continued investment in operations. Adjusted earnings per
share is defined as adjusted net income on a per share basis, where
adjusted net income is defined as adjusted earnings from operations
less net finance costs and income tax expense, plus tax effects of
adjustment items. Order Backlog is the estimated unearned portion
of revenues on customer contracts that are in process and have not
been completed at the specified date. Management believes that ATS
shareholders and potential investors in ATS use these non-IFRS
financial measures in making investment decisions and measuring
operational results. Return on invested capital associated with
this investment, as used herein, means in respect of any fiscal
year, the net income of Comecer in such fiscal year, divided by the
purchase price for the acquisition. Return on invested capital, as
used herein, is used by ATS to evaluate the efficiency of the
allocation of ATS' capital.
Forward-Looking Statements:
This news release
of ATS contains certain statements that may constitute
forward-looking information within the meaning of applicable
securities laws ("forward-looking statements"). Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
performance or achievements of ATS, or developments in ATS'
business or in its industry, to differ materially from the
anticipated results, performance, achievements or developments
expressed or implied by such forward-looking statements.
Forward-looking statements include all disclosure regarding
possible events, conditions or results of operations that is based
on assumptions about future economic conditions and courses of
action. Forward-looking statements may also include, without
limitation, any statement relating to future events, conditions or
circumstances. ATS cautions you not to place undue reliance upon
any such forward-looking statements, which speak only as of the
date they are made. Forward-looking statements relate to, among
other things: the sources of funding for the acquisition; the
purchase price and expected timing of the closing of the
transaction and adjustments and conditions in relation thereto;
expectations relating to Comecer revenue and EBITDA margin;
expectations relating to ATS' earnings per share and return on
invested capital associated with this investment; the strengthening
of ATS' capabilities and position in radiopharma, pharma, biopharma
and ATMP markets and market growth; expectations regarding
integration and deployment of the ATS Business Model; and Comecer
leadership. The risks and uncertainties that may affect
forward-looking statements include, among others: impact of the
global economy and general market performance including capital
market conditions and availability and cost of credit; performance
of the market sectors that Comecer and ATS serve; foreign currency
and exchange risk; the relative strength of the Canadian dollar;
impact of factors such as increased pricing pressure and possible
margin compression; the regulatory and tax environment; failure or
delays associated with new customer programs; that integration and
the deployment of the ATS Business Model are not completed as
quickly or effectively as planned or expected and, as a result,
anticipated benefits, enhancements and synergies are not realized;
that Comecer's business does not perform as expected, negatively
impacting revenue and EBITDA margin and ATS earnings per share and
return on invested capital; inability to close the acquisition, or
delays in closing it, resulting from failure or delays in relation
to satisfying conditions of closing or other unanticipated factors;
that one or more customers, or other persons with which Comecer has
contracted, experience insolvency or bankruptcy with resulting
delays, costs or losses; political, labour or supplier disruptions;
imposition of new duties, tariffs or other legal barriers that
impact Comecer's markets; that growth in the radio pharma, pharma,
biopharma and ATMP markets is less than expected; risks relating to
legal proceedings to which Comecer and/or ATS is or may become a
party; exposure to product liability claims; risks associated with
management or leadership of Comecer being different than expected
or planned due to unanticipated events; risks associated with
greater than anticipated tax liabilities or expenses; and other
risks detailed from time to time in ATS' filings with Canadian
provincial securities regulators. Forward-looking statements are
based on management's current plans, estimates, projections,
beliefs and opinions, and other than as required by applicable
securities laws, ATS does not undertake any obligation to update
forward-looking statements should assumptions related to these
plans, estimates, projections, beliefs and opinions change.
SOURCE ATS Automation Tooling Systems Inc.