Melrose targets new acquisitions after year of disposals
WARWICK manufacturing turnaround specialist, Melrose Industries, has said it will make new acquisitions a priority for 2016 after a year dominated by the disposal of its largest operation.
The group completed the sale of Elster to Honeywell December 29, 2015 for £3.3bn, a deal which represented a multiple of 3.1x 2014 revenue and 14.3x 2014 headline EBITDA.
As a result, £2.4bn is being returned to shareholders.
The group also completed the sale of its Bridon operation in March 2015, this time a more modest £200.4m was returned to shareholders.
Christopher Miller, chairman of Melrose Industries, said: ‘Having successfully sold Bridon and Elster, we have more than doubled the value of shareholders’ equity in both investments and returned £2.6bn in cash to shareholders.
“This has been an exciting 12 months for Melrose and one that yet again demonstrated the ability of the team to create significant value for investors through our ‘buy, improve, sell’ model.
“We remain focused on our search for an acquisition opportunity that will put this proven formula to work once again and will further increase the £4.3bn in cash that we have already returned to investors since our first acquisition in 2005.
“With valuations looking increasingly attractive, we are confident in our ability to find the right deal at the right price and we look forward to inviting investors to participate in this next project in due course.”
