Spirax-Sarco to acquire Cotopaxi at 6x revenue

Thermal energy and pumping specialist Spirax-Sarco Engineering has announced that it will acquire digital consulting and optimisation firm Cotopaxi in a £13.3 million deal, as it seeks to extend its digital strategy.

The acquisition fee represents slightly over a 6x multiple of Cotopaxi’s £2.2 million revenue for the year ending December 31 2020, which was down from turnover of £4.8 million prior to the onset of the COVID-19 pandemic.

The deal will be funded using Spirax-Sarco’s existing cash resources and is set to complete pending the “satisfaction of limited conditions”. Post-acquisition, Spirax-Sarco has said the target firm will be integrated into its steam specialist business, which serves the company's industrial steam customers.

According to the buying firm, this will help create opportunities for it to identify and implement new solutions supporting uptime for steam systems, waste reduction and increased efficiency. It adds that Cotopaxi will benefit from greater market access through the division’s sales presence in 67 countries.

Founded in 2009, Cotopaxi has a team of 38 engineers and software specialists. The business has a global customer base and offers services such as digital connectivity, consulting and monitoring for energy-intensive processes.

Through its software platform, the company seeks to enable industrial customers to increase efficiencies and reduce waste via more effective energy use management. The business is currently under the ownership of Business-Intelligence Of Oriental Nations Corporation Ltd.

Commenting on the deal, Spirax-Sarco Chief Executive Nicholas Anderson said: “The business is an excellent strategic fit for us, as we are both focused on improving the efficiency and sustainability of industrial steam use.”


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