Press Release

Acquisition of Concurrent Real-Time, Inc.

1 April 2021 – Spectris plc (SXS: LSE), the expert in providing insight through precision measurement, today announces the acquisition of Concurrent Real-Time (‘Concurrent-RT’), from Battery Ventures, a Boston-based PE firm, for a purchase consideration of $166.7 million (£121.2 million) in cash, subject to customary closing conditions. The transaction is in line with Spectris’ strategy to make synergistic acquisitions to enhance and grow its platform and potential platform businesses. Concurrent-RT will be integrated into HBK.

Headquartered in Pompano Beach, Florida (USA), Concurrent-RT is a leading developer and supplier of real-time operating systems (‘RTOS’) for hardware-in-the-loop (‘HiL’) simulation applications, especially for aerospace, defence and automotive customers. Concurrent-RT’s RTOS hardware and software solutions are used for testing critical systems to ensure they work correctly within real-time applications and are already used by HBK to power its VI-grade simulators.

In HBK’s technology-driven industries, there is a growing demand from customers for more realistic simulation to help bring higher quality products to market faster and at lower cost. The acquisition of Concurrent-RT significantly strengthens HBK’s current and future simulation offerings and is a further step in building a position of scale in the high growth, rapidly developing and exciting simulation market. The combination also positions HBK and Concurrent-RT to meet a currently unmet market need by combining HiL features with driver-in-the-loop systems – a turnkey solution customers are increasingly demanding and are unable to source today.

For the year ending 30 June 2021, Concurrent-RT’s revenues are expected to be $42 million, with a CAGR of 6% pa since 2018, and an expected EBITDA of $10.4 million. We expect the rising demand for simulation to continue to drive growth as a result of the enhanced customer offering, leveraging bothConcurrent-RT and VI-grade technology and expertise. Combining Concurrent-RT’s and HBK’s respective strengths in aerospace and defence and automotive and leveraging HBK’s sales channels will help accelerate further growth.

In line with the Group’s capital allocation policy, the returns profile is expected to meet our cost of capital by the end of the third full year post acquisition. Following this transaction, the Group is still in a net cash position with further balance sheet capacity for M&A activity and will continue the £200 million share buyback programme which is currently underway.

The transaction is subject to customary completion conditions and regulatory approvals, with completion expected to take place in the second quarter of 2021.

Andrew Heath, Chief Executive, said: “We are delighted to welcome the Concurrent Real-Time team to our HBK platform. Simulation is a key strategic growth area for HBK and Concurrent-RT brings complementary technology to strengthen and expand our virtual testing solutions. Concurrent-RT has demonstrated superior technical performance, strong revenue growth and consistent profitability that will serve us well in building a market-leading position in simulation software and simulator solutions.”

For and on behalf of Spectris plc
LEI Number: 213800Z4CO2CZO3M3T10

Contacts:
Spectris plc
Siobhán Andrews
Head of Corporate Affairs
+44 1784 485325
FTI Consulting
Richard Mountain/Susanne Yule
+44 203 727 1340

About Spectris
Spectris’ global group of businesses are focused on delivering value beyond measure for all our stakeholders. We target global, attractive and sustainable markets, where growth and high returns are supported by long-term drivers. Precision is at the heart of what we do. We provide customers with expert insight through our advanced instruments and test equipment, augmented by the power of our software and services. This equips customers with the ability to reduce time to market, improve processes, quality and yield. In this way, Spectris know-how creates value for our wider society, as our customers design, develop, test and manufacture their products to make the world a cleaner, healthier and more productive place. Headquartered in Egham, Surrey, United Kingdom, the Company employs approximately 7,650 people located in more than 30 countries. For more information, visit www.spectris.com.

About Concurrent Real-Time
Concurrent Real-Time is the industry’s foremost provider of high-performance real-time computer systems, solutions and software for commercial and government markets. Its real-time RedHawk™ Linux® solutions deliver hard real-time performance in support of the world’s most sophisticated hardware in-the-loop and man-in-the-loop simulation, high-speed data acquisition, process control and low-latency transaction processing applications. With over 50 years of experience in real-time solutions, Concurrent Real-Time provides sales and support from offices throughout North America, Europe and Asia. Visit www.concurrent-rt.com for further information.

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