Acquisition
18 November 2003 - 8:02AM
UK Regulatory
RNS Number:1767S
Taylor & Francis Group PLC
18 November 2003
18 November 2003
Acquisition of Dekker for USD 138.6 million strengthens STM portfolio - number
of journal titles published reaches over 1,000
Taylor & Francis Group plc ("Taylor & Francis", "Group"), the leading specialist
publisher of scientific, academic and professional books and journals, announced
today that it has agreed to acquire, subject to the receipt of regulatory
clearances, the business and publishing assets of the Dekker group of companies
("Dekker"), a US based Scientific, Technical and Medical ("STM") publisher from
the family owned, Marcel Dekker, Inc. The consideration will be made up of
$122.0 million (#72.2 million) in cash, a loan note of $1.6 million (#0.9
million) and a further contingent cash payment at closing estimated to be in the
region of $15.0 million (#8.9 million). The cash consideration will be paid
from Group cash resources and banking facilities.
Founded in 1963, Dekker is a leading US based STM publisher of journals,
reference and textbooks and encyclopaedias, in the specialist areas of science,
engineering and medicine. Dekker publishes 78 journals and around 200 new book
titles per year and has a backlist of over 3,000 book titles. Headquartered in
New York City, the business employs some 170 staff.
Dekker's sales for the year ended 31 December 2002 were $42.0 million (#24.9
million), producing an operating profit before exceptional items and
shareholders' costs of $5.1 million (#3.0 million) and profit before tax of $3.2
million (#1.9 million). Primarily a journals publisher, in 2002 sales totalled
$24.9 million (#14.7 million) from journals and $17.1 million (#10.1 million)
from books. Net assets at 31 December 2002 were $0.8 million (#0.5 million).
The nature of Dekker's US dollar revenues and the US dollar purchase
consideration will further reduce the enlarged Group's cash flow based exchange
exposure to the US dollar.
The high quality Dekker titles will enhance Taylor & Francis' existing
scientific, engineering and medical portfolios and have good growth potential as
part of a larger focused publishing group. In particular, the established Dekker
journal titles will complement the titles published by Taylor & Francis in the
same fields. Within the enlarged Group, the Dekker titles will benefit from
Taylor & Francis' international customer base, its traditional and electronic
publishing expertise and the natural economies of scale. As a result, it is
expected that the acquisition will be earnings enhancing in the first year of
ownership*.
In addition to strengthening Taylor & Francis' STM portfolio, Dekker will
reinforce the Group's position in the important North American academic books
and journals market sector. The purchase of Dekker, and the recent acquisition
of Dutch based Swets & Zeitlinger Publishers ("SZP"), are fully consistent with
Taylor & Francis's strategy for growth outlined following the strategic review
initiated in 2002. With the addition of the Dekker titles, Taylor & Francis
expects to publish more than 1,000 journal titles in 2004, together with over
2,000 new book titles and will have a total catalogue of over 30,000 book
titles.
Commenting on the acquisition David Smith, Chief Executive of Taylor & Francis
Group plc said,
"This acquisition fits clearly with our strategy of strengthening our product
portfolio, expanding our customer base and extending our international reach. We
have known the Dekkers for a number of years and I am pleased that we were able
to persuade them to join the T&F Group. The Dekker titles, along with the
recently acquired SZP titles, complement our own high quality STM portfolio.
"While the US market segment is challenging for us and our competitors, this is
a good opportunity to extend our presence in the largest segment of the global
STM publishing market. We have a proven track record for acquiring and
integrating both large and small businesses and believe that Dekker will benefit
from being part of a larger international publisher.
"Taylor & Francis is an acquisitive company and in 2003 we have spent #161.9
million ($273.7 million) acquiring five businesses. Our strategy remains to
grow the business through a combination of organic growth and earnings enhancing
acquisitions."
ENDS
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For further information, please contact:
Taylor & Francis Group plc 020 7583 9855
David Smith, Group Chief Executive
Anthony Foye, Group Finance Director
Financial Dynamics 020 7831 3113
Tim Spratt / Charles Palmer
* The statement that the acquisition is expected to be earnings enhancing in the
first year of ownership does not constitute a profit forecast and should not be
interpreted to mean that the earnings per share in the financial year commencing
1 January 2003 or in any subsequent period will necessarily match or be greater
than those for the relevant preceding financial period.
This information is provided by RNS
The company news service from the London Stock Exchange
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