Tricorn expands US presence with new acquisition
WORCESTERSHIRE-based engineering group Tricorn has expanded its presence in the United States with a new acquisition.
The AIM-listed tube manipulation specialist has purchased the trade and certain assets of the former Whitley Products Inc in a deal worth £1.95m ($2.99m). The deal is being financed from the group’s own cash resources and the transaction is expected to complete later today.
Under the terms of the acquisition, Tricorn will acquire Whitley’s property at Franklin, North Carolina, fixed assets at the facility, all of the Franklin related inventory and certain plant and equipment from Whitley’s other facility located at Plymouth, Indiana. The net book value of the assets is approximately £2.8m ($4.3m).
Whitley, which has been in receivership since January 30, 2013, specialises in the manufacture of fabricated tubular products serving the diesel, agricultural and off-highway industries. It services a blue chip OEM customer base.
The business had a turnover of $31.8m (£20.8m) for the year ended May 31, 2012 (2011: $28.9m (£18.9m)), split approximately equally between the two sites at North Carolina and Indiana. The business posted a net loss of $2.2m (£1.4m) in the year ended May 31, 2012 after a number of one-off costs and interest charges of $1.4m (£0.9m).
The Franklin facility is approximately 60,000 sq ft and has around 100 employees. It has extensive capability in tube bending, welding, furnace brazing and end forming.
Tricorn said the business was closely aligned to its own and would position the group to take advantage of US opportunities.
The Franklin facility will have installed capacity of around $20m (£13m) annual turnover when the transfer of plant and equipment is complete.
Mike Welburn, Chief Executive of Tricorn, said: “Following the establishment of our manufacturing facility in China announced last year, this acquisition represents a further and very significant step in the Tricorn Group achieving a considerable multi-site global business, delivering global tube solutions to a global OEM customer base.
“We have already started to establish close working relationships with Whitley’s US customer base and this is an ideal platform from which to increase sales in the US for the Franklin facility and also for Tricorn’s existing businesses, particularly our Transportation division.
“With the opportunities to increase sales, reduce material costs and enhance operational performance we are anticipating the business to be making an increasing contribution to the group’s earnings towards the latter part of our financial year ending March 2014.”
Headquartered in Malvern, Tricorn currently employs around 300 people and operates through four brands: MTC; Redman Fittings; Maxpower and RMDG Aerospace.
