AB Dynamics acquires US automotive supply business
AB Dynamics, the Bradford-on-Avon based designer, manufacturer and supplier of advanced testing systems and measurement products to the global automotive sector, has acquired California based Dynamic Research Incorporated (“DRI”) for $24.7 million.
DRI is a leading supplier of automotive engineering products and services to the US automotive market with long standing customer relationships. DRI has expertise in performing full-scale track testing of Advanced Driver Assistance Systems (ADAS) and vehicle dynamics tests, providing these services through a test facility and track near Bakersfield, California.
Other services provided include applied research, human factors and simulation. DRI and its wholly owned subsidiary, DRI Advanced Test Systems Inc, also design and manufacture products for use in track based ADAS testing.
Prior to the acquisition, DRI was privately owned by the DRI Employee Stock Ownership Plan and the senior management team will remain with the business in their current roles. DRI will continue to operate as a stand-alone business with independent management with oversight and support provided from the Group.
Based on unaudited accounts, in the year ended 31 May 2019 DRI generated sales revenue of approximately $13.7 million (2018: $10.4 million) and normalised operating profit of $3.7 million (2018: $1.6 million) and they are currently trading in line with management’s expectations. Net assets at 31 May 2019 were $6.8 million.
AB Dynamics CEO, Dr James Routh, said: “The Acquisition supports our strategy to complement long term, sustainable organic growth with attractive acquisitions. This strategy is disciplined and highly targeted against defined strategic, operational, financial and cultural criteria and DRI clearly meets those criteria. DRI has an outstanding reputation in the field of ADAS testing product technology and is a business that AB Dynamics has known, worked with and respected for many years, significantly de-risking the process.
"We believe the transaction will not only increase the Group’s access in the growing US market for ADAS and autonomous vehicle testing and verification, but also complements our technical capabilities and facilities. Together we will be unrivalled in ADAS track testing products and well positioned for future growth in an evolving landscape.
"We expect the Acquisition will be earnings enhancing in the first year following acquisition and we are pleased to welcome the DRI team to the Group.”
In July AB Dynamics announced it had bought simulation software specialist rFpro to strengthen the company’s position in the simulation-based verification market for ADAS (Advanced Driver Assistance Systems) and autonomous vehicles.
rFpro is a specialist in driving simulation for ADAS, autonomous systems and vehicle dynamics. Its software is used as standard on the three main driving simulation platforms on the market and has benefitted from year on year growth since its incarnation in 2007.
