The UK based quality assurance provider Intertek is expanding its global footprint by acquiring the Australian company SAI Global Assurance for $660 million in cash, funded by new borrowings. The deal will be accretive to Intertek’s EPS in the first full year.
SAI Global Assurance, which generates $185 million in annual revenue and operates at 23% adjusted EBITDA margins, is expected to experience “robust organic growth” in the coming years. Intertek also expects the company to experience 300 basis points of margin expansion over the course of the next three years.
One of the major advantages of the acquisition is that Intertek will establish relationships in a number of segments where it is currently falling short. This should allow for some cross selling of services between Intertek and SAI Global Assurance’s customers.