Chemring Group (LSE:CHG) has struck a £20 million deal to buy a UK-based designer and manufacturer of software-defined radio (SDR) tracking systems for defence, government, and law enforcement customers.
The acquisition of Landguard Nexus and its subsidiaries, based in Fareham, Hampshire, adds 30 specialist engineers to Chemring’s Roke business. The combination is expected to accelerate Roke's growth by combining its cyber and electromagnetic activities (CEMA) expertise with Landguard’s modular, high-performance technologies.
Michael Ord, chief executive of the FTSE 250-listed group, said it "further enhances Roke's significant operational capabilities and is further evidence of Chemring delivering its strategy of delivering growth through a combination of organic investment and bolt-on acquisitions in high-priority defence and national security markets."
Landguard's SDR systems and associated security products enable defence, government, and law enforcement clients to protect critical operational assets.
Its technology includes high-performance tracking systems operating across satellite communications, cellular networks, and other radio frequency technologies, along with flexible SDR transceivers featuring the latest interoperability standards. Its products have unique intellectual property and complementary customer relationships for Chemring, the company said.
The current owner-managers of Landguard are expected to remain with Chemring after completion.
Once the deal is completed, an up-front payment of £14 million in cash, funded from existing bank facilities. Cash earnouts of up to £6 million will be subject to performance targets.
Landguard recorded turnover of around £7 million in the last year.
The deal is expected to be marginally earnings enhancing for Chemring in the year ending 31 October 2026.
Completion of the transaction is subject to approval under the UK National Investment and Security Act.