Midwich earmarks €21.6m for German acquisition
Midwich Group, the AIM-quoted audio visual powerhouse anchored in Norfolk, could pay up to €21.6 million (£19.3m) for German company prodyTel Distribution.
prodyTel distributes professional audio and technical solutions products and is based in Stein, near Nuremberg.
Through its German subsidiary Kern & Stelly Medientechnik, Midwich will acquire 51 per cent of prodyTel's share capital for an initial cash consideration of €8.5m (c£7.4m). Options are in place to buy the remaining 49 per cent in June 2024 for €8.1 million (c£7.1m) cash.
An additional performance linked amount of up to €5m (around £4.8m) will be payable in cash in 2026.
prodyTel was founded in 2003, originally as a manufacturer of audio codecs before switching its focus to distribution in 2014. From there, it has developed a strong vendor portfolio including premium brands Biamp, Aver and Jabra, with a particular focus on the corporate and education market.
The company operates across Germany and employs 30 staff. It supplements its core distribution services with a suite of value-add services for trade customers throughout Germany.
These include the prodyTel Academy, offering technology seminars, training courses and product demonstrations to customers from a dedicated 230 sq m space within the Stein facility.
In its latest financial statements, for the year ended December 31, the company generated revenues of €22m (approx. £19.2m) and profit before tax of €4m c£3.5m). Gross assets at December 31 were €6.3m (approx. £5.6m).
Midwich managing director Stephen Fenby, said: “We are delighted to have reached an agreement to acquire prodyTel, which will strengthen our technology offering in the DACH region.
“prodyTel has a strong reputation in the market which has enabled it to attract top tier brands. Customers greatly value the expertise the company is able to offer and will now be able to benefit from the combined portfolio of prodyTel and Kern & Stelly.”
Christian Carrero, Managing Director of ProdyTel said he had received a number of offers for the business over the years but “when the opportunity presented itself to join the Midwich family, it seemed only logical.
“ I believe this deal can bring prodyTel and its people to the next level in distribution and equally will allow us to share our expertise in audio and AV project management to support Kern & Stelly to further grow its business in Germany.
"Not only have I developed a lot of personal relationships over the last 20 years with many people within the Midwich family, but prodyTel has often found itself working alongside Kern & Stelly on common projects. From these interactions, I had already developed a positive feeling about the corporate culture in Kern & Stelly.”