DGL share price surges 5% on acquisition announcement

DGL is investing in its warehousing capacity.

| More on:
Male DGL employees working with chemical bins symbolising the rising DGL share price today

Image source: Getty Images

Key points

  • DGL shares notch up 5.36% to $2.95 
  • The company has acquired Temples' chemical warehousing and distribution business for $3.5 million 
  • This will add 13,000 tonnes of chemical storage capacity to DGL's Western Australia operations 

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.

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.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended DGL Group Limited. The Motley Fool Australia has recommended DGL Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Materials Shares

Young boy wearing a red hard hat frowning with his hands on his head.
Materials Shares

Why has the Allkem share price tumbled 30% from its May all-time high?

The lithium giant's shares have fallen from grace in recent times.

Read more »

A man in a suit face palms at the downturn happening with shares today.
Materials Shares

Why is the Lake Resources share price crashing 25% today?

Lake Resources shares have been sold off on Tuesday...

Read more »

Two smiling men in high visibility vests and yellow hardhats stand side by side with a large mound of earth and mining equipment behind them smiling as the Hawsons Iron share price recovers today
Materials Shares

BHP share price claws back half of Monday’s losses on Tuesday

The iron ore giant's stock is back in the green today.

Read more »

Man with rocket wings which have flames coming out of them.
Materials Shares

Why is the Novonix share price charging 7% higher today?

Novonix shares are having a very positive day (at last!)...

Read more »

rocket taking off indicating a share price rise
Materials Shares

Guess which ASX mining share just rocketed 120% on a major discovery

It's a good day to be invested in this ASX mining share.

Read more »

Worker in hard hat looks puzzled with one hand on chin
Share Fallers

Why is the Lake Resources share price sinking 14% today?

The lithium company's shares are tumbling on Monday.

Read more »

A person wears a roaring lion mask.
Materials Shares

Leo Lithium shares hit the ASX this week. Here’s what you need to know

Leo Lithium shares are hitting the ASX boards this week...

Read more »

A man standing in front of co-workers extends his hand in welcome
Materials Shares

What’s with the Core Lithium share price on Monday?

The Core Lithium share price is slumping today. But that isn't why it's a big day for this ASX lithium…

Read more »