Engineering services firm Mincon finding it difficult to land acquisition targets

Shannon-based engineering services firm Mincon has expressed frustration in its quest to expand through acquisition, saying transaction values being quoted are unrealistically high.

The company specialises in industrial drilling tools.

“We have been active in approaching potential acquisition targets, but we did not see value for the group in the terms that were being sought by vendors, compared with the cost of investing in our own engineering competencies to build a competitive offering,” the company said yesterday.

“We continue to engage in dialogue with potential acquisitions and investments, but in some cases, the asking price is not supported by the earnings,” it said.

However, Mincon still sees “fine companies” worth acquiring and is still looking to buy.

“We are actively continuing to identify and engage with those that we believe would add more than they would cost, and which would continue to fill out our geographic footprint and our product and service offering,” it said.

Despite that uncertainty it yesterday reported a strong set of first-half figures; with pre-tax profits up 11% year-on-year to just over €5m and total revenue ahead by the same percentage to €36.3m.

Its balance sheet remains strong, with net assets totalling almost €100m and it is seeing a strong return to growth in all markets other than Africa, which is being affected by the instability of the South African rand.

Mincon said that it expects to see sales growth, next year, from new product ranges in which it has lately been investing.

“We are investing in our factories to provide for the expansion of our product ranges,” said chief executive Joe Purcell.