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
The practice has been around for over two decades with virtually zero DB transfer exposure and a focus on financial planning. The Practice represents one of the cleanest Businesses you’re likely to see anywhere on the marketplace at this time. Number...
This well-established manufacturer for sale has been trading for over 185 years and has built up a considerable niche business for agricultural and engineering products for a cross-section of industry sectors. The business to be sold is ideal for acq...
Highly Profitable Wealth Management Firm. Great Staff Base Who Will Remain and Continue to Manage the Clients. Established: 25 to 30 years. Number of staff: 5 to 10. Offers invited.
|
21
|
|
Feb
|
Street food catering firm seeks buyer after entering administration | ADMINISTRATION
Shrewsbury-based catering company MPM Catering has entered a...
|
20
|
|
Feb
|
Heycar acquires HonestJohn.co.uk following administration | BUSINESS SALE
Online used car service Heycar has purchased the independent...
|
19
|
|
Feb
|
On-demand laundry app snapped up after administration | BUSINESS SALE
Laundrapp, an on-demand laundry service which was touted as ...
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