Business Weekly - Cambridge, UK

In the spotlight: Synoptics' ProtoCOL technology

SDI chairman, Tee who founded the Roxboro Group (now Dialight plc) in 1990 before floating it in 1993, believes the strategy that saw over £100m returned to shareholders is replicable in the case of SDI.

Shares in SDI, whose digital imaging technology is aimed at improving the speed and efficacy of a range of lab tests are set to begin trading on the AIM market on December 8.

“Given the climate at the moment, this would would definitely be a bad time to float if we were raising capital on AIM,” Tee said. “But the plan is to give liquidity to shareholders and give us tradable paper with which to make acquisitions. It helps of course that we are a cash-generative business.”

He added that the company's sales and profits had held up well in the face of the current recession. “We are feeding into a direct need within the industry - to improve efficiency,” he said.

The market in which SDI operates is ripe for consolidation, according to Tee, characterised as it is by a scattering of niche players who have tailored their technology to a very particular application - or even lab.

SDI made two "fairly small" acquisitions in October but has put any further discussions on hold while the company prepares for flotation.

Tee said that the company would begin mining acquisition prospects "from a fairly long list" early next year. Most of the targets identified are from Europe and the US.

Having been an early investor in Cambridge-based Synoptics - which will act as a lynchpin for planned expansion - Tee was appointed chairman earlier this year.One of his first moves was to bring on board former Roxboro FD, Alf Vaisey.

The Roxboro Group was forged on the back of the acquisition of companies such as Solartron, Weston and Mobrey, ultimately achieving profits of some £20m. Subsequently, all of the companies in the group were profitably disposed of, with profits returned to shareholders.

SDI currently employs around 30 at its Synoptics business in Cambridge, with the prospect of further growth of the facility as the acquisition strategy unfolds.