Just weeks after abandoning merger talks with Oxford Instruments Plc, UEI Plc has succeeded in landing Miles 33 Plc with an agreed bid that valued the electronic composition and publishing systems company at UKP27.4m at close of trade on Thursday. The terms are five new ordinary UEI shares for every three Miles 33 shares held, with no cash alternative. The takeover brings together the colour digital image processing technology of UEI’s Quantel Ltd, best known for three dimensional graphics on TV, and the black and white text and graphics System 400 of Miles 33. System 400 features intelligent terminals running on local networks connected to Data General Eclipse MV minicomputers. It provides automatic pagination, database typesetting, mathematical typesetting and magazine page make-up and sells mainly to the printing and publishing industries. System 400 was responsible for 70% of Miles 33’s UKP7m or so turnover and estimated UKP1.2m pre-tax profit – up 40% and 50% respectively – in the year to February 28 1987. The remainder of the business is from the Solicitors’ Office Management System – typically in the UKP45,000 to UKP50,000 price bracket, twice the average size of Technology For Business Plc’s legal orders – which provides legal practices with word processing, accounts, time and fee recording, and debt collection and conveyancing facilities. Recently, SOMS has started to sell into trust managers and, according to Miles 33 managing director Jon Richards, has considerable growth potential. The main Miles 33 expansion, however, will come from the System 400 business. Already this year, the company has secured a $5m order from Pandick Inc, the largest US financial printing concern, and the North American credibility from that deal has led to another $1m order, this time from Canada. With the help of the Pandick order, Miles 33 took more business in March than its entire turnover in the year just finished. It is this explosive growth which prompted UEI to offer what amounts to 623p a share for a company that was trading before the bid at 333p. Miles 33 shares shot up 247p on the announcement to 580p, still shy of the nominal value of the bid, for which acceptances are already in the bag for 52.8%. With results promised to be exactly in line with City predictions – profits up 31% to UKP17m, turnover up at UKP115m, UEI shares fell 10p to 373. Other UEI interests include Solid State Logic, making digital audio manipulation hardware; the Cosworth auto engine builder; and Link instruments.
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