£100m acquisition sees listed firm snap up fluid power specialist

A Lancashire distributor of industrial, hydraulic and pneumatic products has been acquired by a listed company for around £100m.

R&G Fluid Power in Preston has been snapped up by Diploma, a London-based specialised technical products and services company.

The acquisition forms an “integral part” of Diploma’s strategy of acquiring “value-added businesses, with great management teams, to accelerate our organic growth,” the company said.

It added that R&G has “significant organic growth potential” developing the aftermarket e-commerce channel, continued regional expansion in the UK, and further product cross-selling and diversification.

The business also gives Diploma the Seals Sector scale in the UK and the ability to drive revenue synergies with existing UK Seals businesses.

In a market update Diploma said: “We are also excited by the broadening of the Seals product capability, in line with our strategy to expand addressable markets through product extension, with the potential to take this to other markets in the future.

“An active pipeline also positions R&G well to continue to deliver on acquisition growth.”

Following the acquisition, R&G’s management team will remain with the business.

KPMG’s M&A team led by Jonathan Boyers, Rick Stark, Surinderpal Matharu and Matthew Dearden advised R&G Fluid Power Group on the sale to Diploma.

Jonathan Boyers, head of corporate finance for KPMG in the UK said: “R&G provide specialist fluid power products to businesses, and use their extensive technical knowledge to understand the needs of their customers.

“They have proven to be highly adept at expanding through strategic buy and build, and this deal represents another example of the attractiveness of businesses that have demonstrated resilience, particularly during challenging times.”

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