High pressure equipment firm sold in £3.3m deal
NORTH West-based high pressure equipment specialist Hydratron has been sold in a £3.3m deal.
The Broadheath, Altrincham, firm has been bought by Yorkshire gas cylinder manufacturer Pressure Technologies.
Sheffield-based Pressure Technologies believes the acquisition could support other deals giving it better access to the oil and gas market.
Pressure Technologies has made an initial cash payment of £2.5m with further payments of £400,000 to follow in October 2011 and August 2012. The sum represents seven times Hydratron’s EBITDA for the year to the end of April.
Hydratron is a supplier of high pressure equipment, such as pumps, vales and tubes, to the oil and gas industries and employs 46 staff in Altrincham as well as a further seven in start-up businesses in the US and Australia.
John Hayward, chief executive of Pressure Technologies, said: “Hydratron has been on our target list for a long time as it shares Pressure Technologies’ passion for innovative design, high quality and solid engineering skills.
“The business has good growth prospects and synergies with other parts of our group, as well as providing an anchor for other potential acquisitions serving the oil and gas sector and direct access to the US market.
“It is a valuable addition to our portfolio of companies.”
In addition to providing good growth prospects, Pressure Technologies also believes the acquisition strengthens its position as Hydratron is not dependent on the deep water oil and gas market.
Philip Sanders, managing director and principal shareholder of Hydratron, will stay with the company until next August and will oversee integration of the two businesses.
The deal will see Hydratron’s Australian subsidiary close but a full-time sales presence will be maintained in the region.
US business Hydratron Inc, based in Houston, will be maintained and used by Pressure Technologies’ parts subsidiary Al-Met to service the US market.
Hydratron’s net assets have been valued at around £1.1m with pre-tax profits based on those assets put at £0.3m.
