Atrium Innovations Inc. (TSX: ATB) today announced the acquisition, effective today, of German-based Mucos Emulsions GmbH. (“Mucos”). Mucos, whose main brand is WobenzymTM, has been marketing enzyme based products for over 50 years and had 2006 annual revenues of approximately €62 million (US$85 million). By acquiring Mucos, Atrium establishes its’ Health & Nutrition Division in Europe with a leading brand and gains a privileged access to the German market, the largest European market for dietary supplements. The transaction is immediately accretive, enabling Atrium to increase its normalized earnings before interest, income taxes, depreciation and amortization (EBITDA) by approximately US$27 million to about US$79 million on a pro forma basis and therefore also increasing fully diluted earnings per share by 45%. Following the transaction, Atrium’s pro forma revenues will exceed US$420 million.
“This strategic acquisition allows Atrium to establish a significant presence in Europe with a long established and leading brand in the fast growing health and nutrition market. This is the first step taken by the Health & Nutrition Division to achieve market leadership in Europe. It should be followed by further acquisitions and strong organic growth as we did in the United States and Canada. Moreover, this acquisition marks a major step in our Company’s growth strategy aimed at positioning each of our two divisions as worldwide leaders,” stated Pierre Fitzgibbon, Atrium's President and Chief Executive Officer.
Under the agreement, Atrium will acquire Mucos for the total amount of €127.5 million (US$175 million), representing approximately 6.5 times the normalized EBITDA generated by Mucos. The total amount will be paid in cash and will come from cash on hand and a newly negotiated credit facility of US$350 million that can be increased to US$425 million under certain conditions.
“As with all our previous acquisitions, the acquisition of Mucos generates immediate and significant added-value for our shareholders. As of March 31, 2007, on a pro forma basis, not only would revenues have increased from US$336 million to US$421 million, but EBITDA would also have grown by more than 50% to US$79 million. Also, fully diluted earnings per share would have increased by 45% to US$1.23 on a pro forma basis. Taking into account the profitability of operations, pro forma cash flows would have increased to US$41 million per annum from the current US$32 million,” underlined John Dempsey, Vice-President, Finance and Chief Financial Officer at Atrium.
