By Liz White, ERJ staff
London-Fenner plc is to expand its precision polymers business by buying Wellington Holdings plc's seal-making business. Hull, UK-headquartered Fenner is offering 185 pence per Wellington share, in a deal which values Wellington at approximately Â£44.6 million (Euros 66 million).
Fenner, also a major player in the global conveyor belt business, intends to raise Â£54.1 million via a share placing which is will use to fund the purchase as well as allow for future growth and acquisitions.
Wellington, which makes polymer seals for demanding engineering and industrial applications, â€œhas significant shares in its key markets,â€ with before-tax profits for the year ended 31 Dec 2004, of Â£5.1 million on turnover of Â£33.9 million.
â€œThis is a very exciting opportunity for both companies,â€ said Mark Abrahams, chief executive of Fenner, in a joint statement. As well as materially expanding Fenner's â€œsuccessful precision polymers activities â€¦ Wellington's operations should quickly benefit from our strong presence in many of the markets it has targeted for growth,â€ he continued. The deal also underlines â€œour ability to pursue other strategic opportunities as they arise,â€ Abrahams added.
Following the purchase, Fenner will be in a position to â€œbenefit from potential growth in the energy market and recovery in industrial markets,â€ the statement said.
Wellington's seals business will gain technical synergies, cost savings and â€œan attractive platform to acquire other international businesses,â€ the statement continued.