Doncasters Group sold to Dubai

Dubai International Capital (DIC), the state-owned investment company, is to pay £700m to buy the British engineering company Doncasters Group.

The private equity arm of Royal Bank of Scotland, which has owned the company since 2001, when it was formed through the integration of a number of specialist engineering firms, agreed to sell Doncasters earlier this year, but the deal was finally signed over the weekend.

The takeover is the latest foray into Britain by the Dubai government, which is increasingly keen to use its oil revenues to diversify into a wide range of businesses. DIC already owns the Madame Tussauds operator Tussauds Group, and is the third largest shareholder in DaimlerChrysler.

Doncasters was formed from businesses including Rolls-Royce's Ross & Catherall division and Honeywell's Precision Casting Foundry. Its aerospace clients include Boeing, Pratt & Whitney and Rolls-Royce, while its gas turbine operation sells to Alstom, GE and Siemens. The company, which has a total of 4,700 employees in Europe and North America, also has growing automotive and medical technology businesses.

Eric Lewis, Doncasters' chief executive officer, said the deal would enable it to "build on a robust pipeline and deliver strong growth in the future".

Negotiations over the deal were completed in March, but DIC, which owns and operates nine plants in North America, has been waiting for clearance from the US government.

Earlier this year the US government's Committee on Foreign Investments persuaded Dubai Ports, another state-owned operator, to give up control of American ports it acquired as part of its takeover of P&O. However, the committee has not imposed restrictions on the Doncasters deal. The company employs around 1,000 people in the US.