Skellmax buys businesses in $20m spend-up

Skellmax Industries Ltd said today it has been on the acquisition trail, buying up businesses in New Zealand, Australia and the United Kingdom.

The company, which manufactures rubber products for the dairy industry, and vacuum pumps for dairy and industrial uses, said it has bought Wellington-based Thorndon Rubber Co, Auckland's Rubber Services Ltd, and Melbourne-based Jenco Products Pty Ltd.

Final negotiations are underway over a UK-based agricultural manufacturer.

Thorndon Rubber Co and Rubber Services Ltd provide the New Zealand and Australian print and manufacturing industries with a roller recovering service, an area Skellmax has not had a big presence in to date.

Jenco supplies above and below ground plumbing products and is complementary to Deks Industries, the company's main operating subsidiary in Australia.

Skellmax signed off on the Thorndon purchase at the beginning of July, and the other two purchases are effective today.

The businesses cost a combined total of around $20 million, and are expected to contribute $17 million in revenue each year, $3.5-$4 million at an ebitda (earnings before interest, tax, depreciation and amortisation) level.

Skellmax managing director Donald Stewart said the purchases would "add significantly to the capabilities and intellectual property" of the group.

Shares in Skellmax, which will announce its annual result for the year to June 30 on August 17, last traded unchanged at $1.27.

- NZPA