Lynwood Scientific Developments Ltd, the privately-held Alton, Hampshire manufacturer of display terminals is to be taken over by Hunting Associated Industries Plc. Hunting, which specialises in defence engineering and air support, has offered a maximum of UKP19.2m for the company, UKP5.2m up-front and the balance to be paid according to performance each year over the next three years. It is planned that Lynwood will operate as a separate subsidiary within Hunting Electronics Ltd, the holding company being established to look after electronics businesses that Hunting hopes to acquire in the future. In contrast to a host of companies such as Pericom, Cifer, Microvitec, Sigmex and Telemetrix, which have struggled since going public, Lynwood has enjoyed considerable success in the last three years while remaining private. The company designs, manufactures and sells colour and monochrome graphics and text displays. In January 1985 it won a contract to supply Honeywell with 10,500 terminals as part of a UKP33m contract with the Department of Health and Social Security for an employment benefit offices automation programme. The UKP8m order matched Lynwood’s previous year’s turnover and generated production right up to 1987. Contracts to supply the Terminal Control Units for the Metropolitan Police Crime Report Information System and workstations for the UKAir system built by ICL last year fuelled speculation that the company would soon go public. These successes resulted in pre tax profit of UKP1.2m for the year to June 1987, on a turnover of UKP15.3m. However unaudited management accounts for the eight months ended February 29 show a turnover of UKP5.7m and a loss before tax of UKP500,000. This would appear to be because the eight month period did not benefit from the large production volume associated with the Honeywell/DHSS contract which finished last year. Lynwood has also recently invested heavily in research and development which it says will lead to the launch of new products by the end of the year. These include a range of Unix commercial and military workstations which will greatly expand its product range, as well as a new range of video displays, but declined to give details. Hunting is undeterred by Lynwood’s drop in profitability which it views as short-term. A spokesman said that Lynwood’s order book at the end of February amounted to UKP8.9m and that the company was profitable on a month by month basis. Hunting believes the fusion of Lynwood’s tchnological and marketing experience with its own financial resources and business base, particularly in the defence arena, will enable it to establish a significant electronics business.
HUNTED: LYNWOOD SCIENTIFIC MILITARY UNIX PLANS SECURE TAKEOVER TERMS FROM HUNTING
