PCH agrees to pay €21m for TNS Distribution
Published 17/06/2011 | 05:00
PCH International, the outsourcing and supply chain management business founded by Liam Casey, has agreed to pay up to €21m to acquire Irish firm TNS Distribution in a deal that Mr Casey has described as "game changing" for his company.
TNS, which was founded by John McHugh and Ivan Eustace, was being circled by a number of potential buyers within the past few months.
It distributes consumer electronics products and accessories to retailers across Europe. Its clients include the likes of Dixons, which also owns PC World and Currys. It is the biggest distributor in Europe of accessories for Apple products.
The deal will involve the immediate payment of €6m. Up to an additional €5m is payable over the next three years based on the performance of the company. Over that same period, dependent on PCH's performance, a further €5m to €10m is payable.
Based in Dublin, the latest publicly available accounts for TNS show that it made a pre-tax profit of about €351,000 in the 12 months to the end of June 2010, up from €228,000 a year earlier. Operating profit climbed to €504,000 from €410,100.
Mr McHugh and Mr Eustace were paid a combined €536,000 in the last financial year.
PCH fulfils supply chain functions for companies such as Apple, Dell and Amazon. It has a number of factories in China. Clients also include firms that sell medical devices.
Profits at PCH, which employs 1,300 people, rose to $14.2m (€10.03m) last year as turnover jumped 170pc to almost $413m. Earlier this month it announced that it had raised $30m in fresh equity.
Speaking to the Irish Independent yesterday, Mr Casey said the deal was transformative for PCH and would give it "fantastic access" into the European market.
John Sheridan, a director at Key Capital, which advised TNS, said the deal represented a "very strong multiple" following a competitive sale process. He added it also demonstrated that strong demand remains for high-growth Irish businesses.