Historic manufacturer sold in £365m deal
A YORKSHIRE manufacturer which can trace its roots back to 1789 has been sold in a £365m deal.
Melrose Industries has signed an agreement for the disposal of Doncaster-based Bridon to the Ontario Teachers’ Pension Plan.
Bridon, which manufactures wire and ropes for the construction, mining and energy sectors, was founded in 1924 from an amalgamation of wire rope producers, the earliest of which dates back to the late 18th Century.
The total consideration of £365m on a debt and cash free basis is payable in cash on completion subject to customary adjustments.
As part of the transaction, Melrose will contribute £6.7m into the Bridon Group (2013) Pension Scheme, which will remain with Bridon on disposal.
Melrose, a specialist manufacturing investor listed on the London Stock Exchange, acquired Bridon in 2008.
It said it intends to use the proceeds to pay down existing borrowings and to finance a return of capital in due course.
The disposal is conditional upon certain customary anti-trust clearances and is expected to complete before the end of 2014.
Simon Peckham, chief executive of Melrose, said: “Bridon is an excellent example of the Melrose “buy, improve, sell” model at work. It demonstrates our ability to create substantial value for shareholders by investing heavily in our businesses and improving operational performance.
“Since the acquisition of FKI in 2008, we have successfully grown and developed the Bridon business into a premier supplier of critical high-performance ropes for energy, mining and industrial applications. We have every confidence that Bridon will continue its success under the ownership of OTPP.”
Rothschild is acting as lead financial adviser to Melrose. Nomura also advised on certain aspects of the transaction.
