Tue, 18 Jul 2017 | MERGER
A Gateshead-based company that manufactures parts for electric vehicles is set to be sold to a US automotive firm in a merger deal worth around £150 million.
The North East firm, called Sevcon, has entered into a merger agreement with Michigan’s BorgWarner Inc that would see the British company acquired for $22 (£17) per share.
The deal places Sevcon’s value at around $200 million (£154 million), outstripping its market value by 61 per cent and reflecting the company’s recent contract wins, which will see it making parts for a British supercar company and several overseas suppliers.
Increasing global demand for electric and other low-carbon vehicles has seen Sevcon’s order book swell over the past three years to now be worth £320 million.
Sevcon’s president and CEO, Matt Boyle, told employees that the acquisition could signal a period of substantial growth at the company. The company has recently moved to Gateshead’s Team Valley business park and begun to recruit 200 new employees to add to its existing workforce of 80, though this headcount is expected to rise following the deal’s completion.
Boyle added that the Sevcon board had unanimously approved the proposed merger and, pending approval from shareholders, that the deal would close within the next two months.
He said: “I am enormously proud of what we have achieved so far. To carry that work forward we need to become larger quickly, as required by our potential customers. We need to take on the substantially greater projects which a merger with BorgWarner will allow us to consider.
“The combination of Sevcon and BorgWarner skills is what the market for electrification is demanding.”
It is unclear whether the Gateshead firm would continue under its own brand or be subsumed into the BorgWarner name, though its senior team – including Boyle – will remain.
Subscribe to Business Sale Report here
A family run business in its third generation, supplying office furniture nationwide either directly or through white label websites on behalf of other retailers. Having built up an excellent reputation for the product range and service provided, the...
Indicative offers are required by noon of Tuesday 22 September 2020, with a sale concluded by no later than the close of business on Friday 25 September 2020 and therefore only parties that are able to work within this time frame should respond.
Presenting to the market a well established 2 surgery practice due to the vendors plans to reduce responsibilities. Income is derived from fee per item patients and a large capitation scheme which equates to 32% of the practice income.
Scottish accountancy firm Goldwells has expanded with the ac...
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