The DGL Group Ltd (ASX: DGL) share price is on the move today.
This comes after the company announced the acquisition of a chemical warehousing and distribution business.
At the time of writing, DGL shares are up 5.36% to $2.95 apiece.
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DGL expands warehousing capacity
According to its release, DGL advised it has strategically acquired the Temples chemicals warehousing division for $3.5 million.
Located in Perth, Temples' chemical storage and warehouse business in one of the largest of its type in Western Australia. The group provides store, consolidate and distributes a variety of freight types within the industry.
The agreed purchase price represents a valuation of 2.2 times the last twelve months of Temples' earnings (FY21). The deal is being funded solely by tapping into DGL's existing cash reserves.
DGL stated that Temples adds 13,000 tonnes of chemical storage capacity to its Western Australia operations.
In addition, there is now over 10,000 square kilometres of operational space for transport equipment and shipping container work.
This takes DGL's total chemical storage to more than 153,000 tonnes across 56 dedicated chemical management sites.
DGL founder and CEO, Simon Henry commented:
The acquisition of Temples chemical warehousing division helps with our organic growth as well as targeted new business opportunities.
DGL share price summary
It's been an impressive 12 months for the DGL share price, rising by more than 192% in value.
The company entered the ASX in late May with a share price of $1 and has made quick progress since.
Based on valuation metrics, DGL presides a market capitalisation of roughly $781.74 million, with 269.84 million shares outstanding.
