Industrial M&A hots up with AW Flow acquisition

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Cash-rich trade buyers will continue to snap up niche UK industrial firms as the hunt for specialist expertise continues, according to experts at Clearwater Corporate Finance.

Clearwater Corporate Finance advised on the £24m sale of oil and gas specialist valve manufacturer AW Flow Group (“AW Flow”) to AIM-listed engineering firm Hamworthy – a transaction it believes that mirrors the wider trends in industrial M&A.

Leeds-based AW Flow, which employs 141 people, will be merged with Hamworthy’s pump systems business to form a new division called Hamworthy Flow Solutions.

Hamworthy, which floated in 2004, engineers fluid handling systems and a range of other high technology products and services to the marine and oil and gas industries. The Dorset-headquartered firm operates in 11 countries and employs over 1000 people worldwide.

The deal team from Clearwater comprised partners Paul Newell and Constantine Biller, supported by Sebastian Saywood.

Constantine Biller, partner at Clearwater Corporate Finance, said: “The UK is home to many of the leading players in the flow products industry, which are well known for their advanced development capabilities and ability to operate within complex supply change in some of the most demanding markets.

“The cash-only acquisition of AW Flow Group illustrates the growing appetite and capacity of trade buyers, many from emerging markets, to flex their financial muscle and satisfy demand for niche engineering and manufacturing expertise. As the flow products industry is highly resilient to the economic downturn, I expect M&A activity to remain strong in the sector and be a key driver of interest in UK manufacturing firms.”