Torotrak agrees £23m deal for Flybrid Automotive

LANCASHIRE engineering business Torotrak has agreed a £23m deal to buy automotive technology firm Flybrid Automotive.

Torotrak, a developer of gearless traction drive technology, is paying for the business with the proceeds of a £16m share placing which has given a US customer, Allison Transmission, the chance to invest.

Earlier this year Torotrak paid £3m for a 20% stake in Silverstone-based Flybrid. It developed a fuel efficiency device for Formula 1 cars which is being applied to cars and commercial vehicles.

The two companies have been working on a system for hybrid vehicles that uses a flywheel rather than batteries to store energy. They say this is cheaper and will be in demand as vehicle manufacturers chase tough Co2 targets.

Under the terms of the deal it will pay £8m in cash and shares on completion with the remaining £15m linked to performance targets. Flybrid’s managing director, and largest shareholder, Jon Hilton will join the Torotrak board along with technical director Doug Cross.

Torotrak’s chief executive Jeremy Deering said: “Today’s announcement marks a significant step in our strategy to capitalise on the substantial opportunities in global automotive markets in the next few years. The acquisition of Flybrid enables the group to commercialise an affordable hybrid system (Flybrid M-KERS) that the directors believe is capable of mass market adoption.

“The funds raised support our plans for low volume manufacturing and accelerated testing facilities for a start of production in 2015 to supply initially the UK bus market. For mass car markets, the strategy over the next 12 to 24 months is to  increase our engagement with vehicle OEM and Tier 1 manufacturers to maximise the opportunities for take up of our V-Charge and Flybrid M-KERS technologies from 2017 onwards as tougher new CO2 regulatory targets are implemented.”