Judges Scientific (JDG) is a UK-listed serial acquirer focused on niche scientific instrument businesses. Just as Constellation acquires vertical market software companies or Halma niche industrial engineering products, JDG specializes in UK-based design and production companies in the instrumentation business.
In 2005, David Cicurel, JDG’s founder and current CEO, listed the company as an investment vehicle to buy stakes in small public companies and flip them to PE at a premium. Due to rapidly increasing public market valuations prior to the GFC, this original business model quickly became out of date.
However, after Cicurel’s first acquisition of Fire Testing Technologies, he discovered the advantages of UK scientific instrument businesses that dominate a tiny, niche global market. JDG pivoted from a public-to-private arbitrage strategy to buying and holding quality, private companies that dominate a small market.
Cicurel effectively stumbled upon the UK scientific instrument business and has since made 20 acquisitions and grown FCF per share at 22% per year. In 2005, from a blank cheque, JDG’s has returned 30% per year including dividends, an 81x return. Cicurel also still owns 11% of the shares outstanding.
We recently interviewed a Former Sales Director at GDS Instruments, a JDG portfolio company, to better understand the instrument business and the quality of JDG subsidiaries.
GDS Instruments designs, develops and manufactures equipment and software for computer-controlled testing of soils and rocks. The specialized equipment is used to evaluate the mechanical properties that are key in geotechnical and earthquake engineering design.
You can get a sense of GDS machines from the image below:
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