TT electronics has acquired the majority of the business of Semelab, supplier of RF, opto and semiconductor products, for £9.8m.

The Scotland-based Semefab MEMS and manufacturing business, which is part of the Semelab Group, is not included in the deal.

TT’s strategy is to build a design and manufacturing business focused on what it calls “niche electronic components” which includes products for military, aerospace and medical sectors.

The acquisition of Lutterworth-based Semelab expands TT’s presence in the UK and Europe. “The acquisition significantly strengthens our position in the key military and aerospace markets with major customers in the UK and Europe,” said Geraint Anderson, chief executive of TT electronics.

“We are acquiring a profitable business which will benefit from the group's global sales network and our technical capabilities,” said Anderson.

The purchase price is subject to an adjustment based upon the debt free, net assets delivered at completion, which are expected to be approximately £6.2m.

For the year to 31 October 2008, operating profits attributable to the acquired business are expected to be approximately £1m.
The consideration is payable in cash and will be funded from the group's existing debt facilities. The current management team will remain with Semelab.