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Codan strengthens broadcasting capability

Electronic hardware and software producer, Codan, has announced it will acquire UK-based Broadcast Wireless Systems from its founders.

Codans subsidiary Domo Tactical Communications said it would acquire 100% of the shares in the company, whose technology portfolio consists primarily of wireless video camera links and a newly developed range of high-quality video broadcast products.

The transaction is funded by Codan’s existing debt facility, which consists of an upfront payment of $3.7 million, with the possibility of an additional payment of up to $4.8 million if certain earn-out targets are achieved over 3 years.

Codan hopes to build on its strategy of investing and strengthening core businesses by developing new products, entering into new geographies and leveraging IP into other adjacent markets. The company recently acquired businesses, DTC and Zetron, which it confirmed continue to make good integration progress and remain on track to deliver FY22 EBITDA targets. While the BWS acquisition is not of the same scale, Codan said it is strategically important, as it broadens DTC’s technology offering and enables access to the growing remote broadcast industry more quickly than developing this technology internally.

The acquisition will be earnings-per-share accretive from day 1 given that BWS delivered an EBIT of approximately $0.6 million in the financial year ended 30 June 2021, a year in which financial performance was adversely impacted by the pandemic. As a result of the transaction, Codan will acquire total assets approximately equal to the purchase price with no change to Codan’s shareholder equity.

Codan’s President of Tactical Communications, Paul Sangster, commented “the quest for improved production quality, cost efficiencies and the challenges caused by the pandemic are fuelling the transition of broadcasters to adopt remote production capabilities and the combined offering of DTC and BWS will enable this. DTC’s customers will now be offered a low-latency, high performance solution which has been validated in critical and challenging operations such as the opening ceremony for the Olympic Games in Japan and some of the world’s most prestigious and demanding motor racing events.”

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