$1bn deal ensures bright future for Yorkshire engineering firms

ENGINEERING group Clyde Blowers has completed the £600m acquisition of US group Textron’s fluid and power division which includes Yorkshire-based David Brown Gear Systems and Union Pump.

The deal sees East Kilbride-based Clyde Blowers, which was founded by Scottish entrepreneur Jim McColl, buying the division backed by Boston-based

HarbourVest Partners and UK firm Pantheon Ventures with leveraged financing from Bank of Scotland, Barclays, HSBC and Royal Bank of Scotland.

The operation bought from Fortune 500 industrial company Textron, includes four separate businesses:

• Huddersfield-based David Brown, which employs 1,113 staff at 18 locations in 11 countries and provides gearing equipment for the defence, mining and power industries;
• Union Pumps based in Battle Creek, Michigan which produces centrifugal and reciprocating pumps to the nuclear power, petrochemical processing, desalination and industrial markets and has 730 employees at 10 locations in six countries – including Penistone in South Yorkshire, the US, Canada and France;
• Maag Pumps systems based in Oberglatt, Switzerland, a global provider of highly engineered polymer and compounding pumps with 275 employees at eight locations in seven countries
• David Brown Hydraulics based in Poole, a niche provider of hydraulic pumps, motors, valves and power take off units with 119 employees at 10 facilities located in nine countries,

The deal, which Mr McColl says “took a bit of time” to put together, was first announced in September. It takes Clyde Blowers – the parent company of Doncaster-based AIM firm Clyde Process Solutions, to turnover of £1.2bn with 5,000 employees across the world.

Mr McColl said: “I am absolutely delighted to sign a deal of this magnitude, especially in the current economic climate. We are talking a total value of $1bn, including additional working capital, bonding facilities, the integration with Union Pumps of the Weir Pumps business – which was bought by Clyde last year – and payment of up to $645m to Textron. It is a very substantial deal for a British company.

“I believe it is a great boost for British business. At a time when the news is all about foreign businesses coming to the UK and buying our biggest companies, here is a story of a British company having the clout to buy an entire division from a global company ranked 202nd in the American Fortune 500.

“It is remarkable, and testament to the growing strength of Clyde Blowers as a global company in our own right that we have been able to put together such a deal at this time.

“Each of the acquired businesses has its own top quality management team. We look forward to working with our new colleagues to help them realise the tremendous potential in all of these businesses.”

Mr McColl, 55, started his working life as a 16-year-old apprentice engineer at Glasgow company Weir Pumps – which is now part of his group.