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 £44.6 million (Euros 66 million).
Fenner, also a major player in the global conveyor belt business, intends to raise £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, “has significant shares in its key markets,†with before-tax profits for the year ended 31 Dec 2004, of £5.1 million on turnover of £33.9 million.
“This is a very exciting opportunity for both companies,†said Mark Abrahams, chief executive of Fenner, in a joint statement. As well as materially expanding Fenner's “successful precision polymers activities … Wellington's operations should quickly benefit from our strong presence in many of the markets it has targeted for growth,†he continued. The deal also underlines “our ability to pursue other strategic opportunities as they arise,†Abrahams added.
Following the purchase, Fenner will be in a position to “benefit from potential growth in the energy market and recovery in industrial markets,†the statement said.
Wellington's seals business will gain technical synergies, cost savings and “an attractive platform to acquire other international businesses,†the statement continued.
