Klarius chief hunts next big deal

TONY Wilson, director of automotive parts manufacturer Klarius Group, is on the hunt to acquire another business after making significant headway in transforming the Quinton Hazell business bought in February 2010.

The company, whose main UK factory is in Cheadle near Stoke, has been looking to complete another major acquisition and has spent a considerable amount of management time and effort in 2011 assessing potential targets.

“We’ve kissed a lot of frogs but we haven’t found our prince,” he said.

“There’s been no shortage of businesses for sale but it seems like there’s a great shortage of businesses that have a synergy benefit for Klarius.

“There’s no point doing a deal just for the sake of it. Turnover is vanity and profit is sanity.”

Mr Wilson said, following its takeover of Quinton Hazell in February 2010, there was a £9m swing in profitability, with the business moving from a £7m loss to a £2m profit.

Klarius Group achieved a net profit for 2010 of £5m on sales of £250m.
He said the change in its fortunes was due to the “absolute grinding focus” of Klarius’s management team.

The firm was formed four years ago when Wilson bought the European division of US-based exhausts maker Arvin Meritor in a deal which was understood to have been worth £12m.

Adding Quinton Hazell has allowed it to make efficiencies in terms of operations and deliveries, as well as significantly increasing its product range.

The company now manufactures 90,000 parts from five manufacturing plants – three in the UK, one in Spain and one in Germany.

It employs around 1,200 people – 250 of whom work at its exhaust plant and European distribution centre in Cheadle.

Other than the closure of a plant in Italy on the shores of Lake Como, Wilson said the company had not made any major cuts.

Indeed, he takes great pride in the fact it reversed a decision taken by previous owners to close Quinton Hazell’s water pumps plant in Colwyn Bay to outsource work to China.

The plant site is where Eric Quinton Hazell started the business and will next year celebrate its 60th anniversary.

“That plant posted a profit at month six for the first time in 12 years and it has consistently performed at that level since,” Mr Wilson added.

“In fact, the most expensive part was getting out of the contract with China. But I’m chuffed that it’s still there – and I’m even more chuffed that it’s profitable.”

He said much of the cash generated through operations had been poured back into the business, with £5m spent on its shock absorber facility at Bilbao in northern Spain and £1m on a new website – created by Liverpool-based Rippleffect.

Mr Wilson says the latter will allow users (including the general public) to enter the registration number of their car in several major territories.

It will also list the requisite parts it stocks and if replacements are ordered they can be shipped via DHL to arrive on the following day.

“It will tell you more about your car than you know yourself,” he said.

“That’s been a massive investment for us and it positions us for an expansion into new markets.”