Hills offloads AV business to focus on security and health

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Hills offloads AV business to focus on security and health
David Lenz, Hills Group MD.

Hills Limited has shed its AV division.

The distributor announced to the ASX today (pdf) that it reached an agreement to sell the operation to AV distie Amber Technology for an estimated $5.5 million.

The transaction includes the “majority” of Hills’ AV staff and brands to ensure continuity for customers and vendors. It also includes inventory (dependent on valuation at settlement) and Hills’ capitalised R&D.

Hills’ AV business includes audio products, conference and education technology, control systems, headphones, displays and other hardware.

With the sale of its non-core business units, Hills’ plans to focus on just two businesses: a fast-growing health division, and its security and technical services distribution division. Last month, Hills agreed to sell its underperforming antenna business to Bitek

Hills Health – which offers nurse call solutions, patient engagement systems and Wi-Fi networks to hospitals – grew revenue by 23 percent in the 2019 financial year to reach $38.1 million.

The distribution business, which now focuses on integrated security technology solutions and technical services, reported $229.3 million in revenue in FY19, down 4.8 percent. The AV business was previously accounted for in the Distribution division.

“Hills has a long history of participation in the AV markets in Australia and New Zealand,” said Hills CEO and managing director David Lenz:

“We have appreciated the support of our customers and suppliers over many years. However, our future lies in the health, security and technical services sectors, and so we are very pleased to have found a new opportunity for our AV colleagues, customers and suppliers at Amber Technology. With these changes, we are plotting an exciting future for Hills by focusing on those businesses with the most potential for growth.”

The acquisition is expected to be completed in early December 2019, and is still subject to certain conditions such as approval from shareholders in Amber Technology’s parent company Ambertech Limited.

Hills said it anticipates using proceeds of the sale to reduce debt.

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