Industrials sector comment – November 2012

Dato

Clearwater’s Industrials Team is delighted to announce our latest transaction in the industrial services sector.

Last month saw the multi-million pound management buyout of Palletower (GB) Limited, a global leader in the manufacture and supply of storage, handling and distribution equipment to the majority of the UK’s major retailers. The company which was established more than four decades ago employs more than 50 people in its premises in Sale and Trafford Park. It provides retailers with such equipment as clothes rails and shopping trolleys as well as plastic containers and pallets, and uses manufacturing plants based in China.

Clearwater acted on the sell-side as advisor to the majority shareholder, Paul Hutchins, who we had previously advised when he led a MBO of Palletower in 2001. Mr Hutchins has successfully grown the company to reach a turnover of £16.2m. Palletower has now been sold to the next generation of management led by Matthew Palmer, who joined the company in 1993.

Deals

Wolseley plc has agreed to acquire the property, stock and vehicle assets of 22 sites from Burdens Limited, a UK leading supplier of drainage and civil engineering products. The purchase will extend the reach of Wolseley’s utilities business in the UK and provide them with a leading position in the underground drainage sector.

Alicat Workboats Limited has acquired South Boats Special Projects Limited, a manufacturer of service vessels for the offshore wind power industry, out of administration. Alicat Workboats is a major player in the industry and was attracted by South Boats’ strong reputation and a healthy order book of £21m and further enquiry pipeline of £35m.

Private equity firm Exponent Private Equity LLP has acquired HSS Hire Services Group Limited, a leading UK national supplier of tools, equipment and related services. The transaction, which provides an exit for Och-Ziff Capital Management Group LLC and Perry Capital LLC, will enable further growth of HSS by unlocking fresh capital.

Private equity firm AEA Investors LP has made a significant investment, thought to be in excess of £100m, in Sparrows Offshore Group Limited, a UK-based oilfield services company. The investment will finance acquisitions as well as organic growth.

Fenner plc, through its subsidiary Fenner Dunlop Australia Pty Limited, will acquire Australian Conveyor Engineering Pty Ltd, a privately owned group of companies based in New South Wales, Australia involved in supplying engineered conveyor solution for the design, manufacture and installation of high capacity conveyor systems for both surface and underground mining. The acquisition furthers Fenner’s strategy of being the supplier of choice for engineered conveyor solutions in Australia.

Amec plc has formed a joint-venture with Samsung Heavy Industries Co Ltd and Samsung Engineering Co Ltd to carry out the design engineering for fixed and floating offshore platforms, FPSOs and subsea pipelines for Samsung’s future offshore oil and gas projects. The joint-venture, which is subject to regulatory approvals, will be named AMEC Samsung Oil and Gas LLC, and will combine AMEC’s design engineering capability and experience in offshore projects and Samsung’s leading project management expertise and shipbuilding technology.

Bodycote plc has acquired seven facilities comprising six in South Eastern USA and one in Southern Indiana from Carolina Commercial Heat Treating Inc, a US-based heat treatment business. The acquisition represents a step forward in delivering Bodycote’s strategy in North America and additionally is the first meaningful exposure for Bodycote to the off-road vehicle and heavy truck market in the USA.

M+W Group GmbH has acquired Senior Hargeaves Limited, a supplier of heating and ventilation ducting to the nuclear and construction industry from Senior plc. The business was considered non-core to Senior’s strategic direction and fits well with M+W’s plans for sustained growth in their target markets.

Palletower (GB) Limited, a leader in the manufacture and supply of storage, handling and distribution equipment has been bought by its management in a multi-million pound deal. The company had originally been through an MBO led by Paul Hutchins in 2001 who has successfully grown the company.

Premier Technical Service Group Limited has acquired Protectis Limited, a leading lightning protection company based in Nottingham. The acquisition will strengthen Premier’s already established position in the lightning protection market and fits well with their strategy of achieving market leadership in the sectors they operate in.

Vita Nonwovens Inc, a division of UK parent The Vita Group has completed a management buyout of the business from Vitafoam Inc, backed by private equity firms Capital South Partners and Crutchfield Capital combined with Source Capital Mezzanine Fundand PNC Bank. The division produces high quality nonwoven fibre materials for use in bedding, furniture, hygiene, automotive filtration and building products.

CRI Pumps Pvt Ltd has signed a business transfer agreement to acquire the pumping solutions unit of UK-headquartered Pumps & Process Systems Ltd. The agreement will broaden CRI Pumps’ industrial solutions such as pulp handling, slurry handling and chemical handling for a variety of industries.

Senior plc has acquired GAMFG Precision LLC and its parent GAMCO Acquisition Company, a manufacturer of engineered high-precision machined components and assemblies for the off-road land vehicle and aerospace markets. The acquisition represents an excellent strategic addition to Senior’s Flexonics Division adding new machining capabilities and enhancing growth prospects within the group.

Kuroda Precision Industries Ltd has acquired Avingtrans Plc’s Industrial Division, which designs, manufactures and services precision ballscrews, spindles and linear motion actuation systems for automation and control of CNC machines and precisions instrumentation for £13.45m. The disposal will enable Avingtrans to fully focus on its two core sectors through its remaining Aerospace and Energy & Medical divisions.

HSS Hire Service Group Limited and the management team of Abird Generator Hire Ltd have acquired Abird Generator Hire Ltd, a company engaged in the hiring of diesel electricity generators. The transaction will enable HSS to further increase its range of products and service offerings and expand its business activities and follows the recent acquisition of HSS hire by private equity firm Exponent Private Equity LLP.

Illinois Tool Works Inc has acquired Lock Inspection Systems Limited, a UK based supplier of industrial metal detection equipment from Royal Bank of Scotland Group. The acquisition will enable Lock to enhance its presence in a global market and allow Illinois Tool Works to further expand its geographical reach.

Franke Washrooms Systems AG has acquired Dart Valley Systems Limited (DVS), a UK manufacturer of electronically controlled plumbing products, from P+L Systems Ltd. The acquisition will enable Franke Washrooms to expand its presence in the UK and enable DVS to access European markets.

IMI plc has agreed a joint-venture partnership with anghaiAutomation Instrumentation Company Co Ltd, a controls and instrumentation technology company, to supply control valves into the nuclear power market. The nuclear power market in China is the fastest growing in the world and the joint-venture will enable IMI to play a significant role in this development.

MJP Waterjets AB has acquired Ultra Dynamics Ltd and Ultra Dynamics Inc, suppliers of aluminium axial flow waterjets. Combined, the companies will enhance their offering in the marine market by building on both companies’ strengths.

The O’Gara Group Inc has agreed to acquire BAE Systems PLC’s Ohio based Commercial Armoured Vehicles LLC business which manufactures armour systems for military applications and commercial armoured vehicles. The transaction follows the announcement of BAE to move military production work at the Ohio site to the Texas facility thereby improving competitiveness and enabling the company to focus on core capabilities.