Wed, 17 Mar 2021 | BUSINESS SALE
Buy-and-build engineering group Avingtrans has sold Peter Brotherhood for a total consideration of £35 million, a more than 10x multiple of the £3.3 million in operating profit the company delivered last year.
The Peterborough-based business is being acquired by Howden, a group specialising in air and gas handling equipment. Of the £35 million enterprise value, Avingtrans will receive net proceeds of around £30.6 million prior to costs.
Peter Brotherhood specialises in the design, manufacturing and servicing of steam turbines and turbine generators and operated in Avingtrans’ Process Solutions and Rotating Equipment (PSRE) business.
Avingtrans acquired Peter Brotherhood in 2017 as part of its £52.7 million takeover of the Hayward Tyler Group. Peter Brotherhood represented around £9.3 million of this acquisition, meaning the sale has generated a return of around 3.7x the original investment.
The disposal forms part of Avingtrans’ Pinpoint-Invest-Exit (PIE) build-and-buy strategy, through which the group generates returns by acquiring companies before restructuring and selling them.
With Peter Brotherhood, Avingtrans undertook a rapid restructuring and strategy reset, before embarking on a recruitment and training drive focused on the firm’s sales force, sales agents and aftermarket team.
This drove a recovery at the once struggling firm, which generated revenues of £25.7 million in the year ending May 31 2020, contributing £3.3 million to the group’s operating profit. Prior to its acquisition by Avingtrans, Peter Brotherhood's year-end accounts for March 31 2017 show it making a pre-tax loss of £2.1 million on turnover of £16.2 million. This increased value prompted Avingtrans to decide to sell the business.
Avingtrans Chief Executive Steve McQuillan said: "This well executed exit of Peter Brotherhood once again demonstrates the success of the Avingtrans PIE strategy. Peter Brotherhood was in poor shape when we acquired it in 2017, but it has been turned around to make it attractive to specialist Groups in its sectors. The result is enhanced value for Avingtrans shareholders and the potential opportunity to repeat the PIE model elsewhere."
Find out more about how restructuring can increase your sale price with these BSR insights:
If ever there was a time for business restructuring, that time is now.
Positioning your business for a post-COVID sale.
Find businesses for sale here.
If you are looking for an exit, we can help!
The company produces and supplies a wide range of coffee products created using ethically sourced beans from South America. The core products comprise wholebeans, grounds, single-origin roasts, blends, cold brews and compostable pods.
LEASEHOLD
The business was first established by the owner in 2019, building up an excellent reputation during its time of trading. As seen by some online ratings and reviews, the business is extremely popular within the local area.
LEASEHOLD
The company offers a variety of day surgery tables, all of which are manufactured with reliability, performance and manoeuvrability in mind. The family-run business supports all clients post-sale with planned preventative maintenance solutions, offer...
RELOCATABLE
03
|
Feb
|
Social media marketing firm acquired at up to 41.6x operating profit | BUSINESS SALE
Manchester-based social media and influencer marketing agenc...
03
|
Feb
|
Pub group planning to sell 1,000 sites as pressures on hospitality mount | COMMERCIAL PROPERTY
Stonegate Group, the UK’s largest pub company, is repo...
02
|
Feb
|
Babble hits 12 acquisitions in a year with double takeover | BUSINESS SALE
London-based cloud technology firm Babble has continued its ...
Sign up to receive our acquisition alert emails to get your FREE guide
Business Sale Report is your complete solution to finding great acquisition opportunities.
Join today to receive:
All this and much more, including the latest M&A news and exclusive resources