Melrose closes £30m sale of injection moulding business
WARWICKSHIRE-based manufacturing turnaround specialist Melrose has closed the sale of its UK injection moulding business – and Jaguar Land Rover supplier – McKechnie Engineered Plastics Ltd in a deal worth £30.7m.
The business, which trades as McKechnie Plastic Components (MPC), has been sold to Rosti and Melrose said the sale proceeds would be used to reduce net debt.
At December 31, 2011 MPC had gross assets of £46m and net assets of £26.6m.
Melrose said the acquisition of McKechnie, along with the Dynacast businesses, in May 2005 for a net equity investment of £243.6m has resulted in total cash generation, including all disposal proceeds and the repayment of debt, of nearly £800m – giving a return on initial equity of approximately 3.25 times.
Christopher Miller, Melrose chairman, said: “MPC is the final piece of the successful Dynacast and McKechnie acquisition to be sold, it has performed well as part of the Melrose group and we wish the management team every success for the future.”
McKechnie Automotive & Engineered Plastics is one of Europe’s leading manufacturers of engineered plastic assemblies supplying sectors as diverse as automotive, telecommunications, consumer and business durables, specialist packaging, building products and healthcare.
In addition to JLR, customers include Ford, Volvo, M&S, drinks group Diageo and computer giant HP.
McKechnie Automotive & Engineered Plastics moulds and extrudes plastics from its two UK sites, based in Stamford Bridge and Pickering, both Yorkshire, alongside a metal fasteners facility in Swansea.
MPC Stamford Bridge houses the divisional technical centre specialising in a wide range of CAD design and Moldflow tools to assist with in depth product development. Advanced automotive and Multi-shot mouldings are also a feature.
MPC Pickering is the divisional centre of excellence for the group’s automotive work, where high volume output and statistically repeatable quality are fundamental to many of its clients’ needs. It also offers extensive painting, extrusion and assembly facilities on site.
The Welsh operation, MPC Canning Brett, manufactures and supplies an extensive range of fasteners and pressings to the automotive market.
