Hanson focus sharpens with pounds 145m sale
Tuesday 15 April 1997
The deal, one of the first since Hanson demerged its chemicals, energy and tobacco operations in a four-way break-up last year, follows a pounds 78m American acquisition last month which made Hanson one the US's largest concrete pipe producers.
Following the buyout, Hanson Electrical will rename itself Electrium. The business, which contributed about 6 per cent of Hanson's operating profits last year is one of the leading suppliers of electrical wiring accessories and circuit protection products both for new build residential and commercial buildings and for use in repairs and maintenance.
Hugh Langmuir, a director of CINVen, said: "Electrium is a high-quality business which has considerable growth opportunities available to it given the strength of its brands and reputation for excellence. We are delighted to be providing the funds for the acquisition."
Electrium's products include switches and sockets, sold under the Crabtree, Volex and Marbo brands, miniature circuit-breakers and household electrical cords. It employs 3,000 people in six UK manufacturing operations and plants in France, Dubai and Malaysia.
Cinven, itself a management buyout from the British Coal Pension Fund in October 1995, will be the majority shareholder in Electrium, which was built up by Hanson as a result of a string of acquisitions over the past 15 years. The original wiring business came with the acquisition in 1982 of British Ever Ready. Volex was added in 1991, followed by Scholes, which joined the group in 1994 in an agreed bid.
CINVen manages around pounds 1bn on behalf of three clients, British Coal Pension Funds, Railway Pension Schemes and Barclays Bank Pension Funds. It recently completed its first independent fund raising of pounds 300m, which forms a private equity fund dedicated to investments in the UK and Europe.
Pre-tax profits last year at Electrium were pounds 13.4m struck from sales of pounds 144.7m. Just over two-thirds of turnover is in the UK with the balance going to France, the Middle East and Asia. At home, the it is a big supplier to electrical wholesaling groups.
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