Fandstan Electric Group Limited / Wabtec Corporation
Cavendish Corporate Finance, the UK’s leading sell-side mid-market M&A advisory firm, is delighted to have advised the shareholders of leading electrical engineering firm Fandstan Electric Group Limited (Fandstan) on the circa £130 million ($215m) sale of the company to Wabtec Corporation. Wabtec is a $7 billion NYSE listed global provider of value added technology products and services to the rail and transit industry.
Fandstan was formed in 1979 by The Lord Tanlaw, who has wide business interests and is a former director of his family’s firm Inchcape plc. The company designs, manufactures and installs products for the transmission of electrical power and data to moving equipment and vehicles for two main markets; rail transportation and industrial.
The Group’s highly engineered railway, metro and tram products include on-board equipment such as pantographs and third rail shoe gear, and infrastructure products including third rail and light overhead catenary systems. It’s industrial products include slip rings for wind turbines, motorised and spring driven reeling systems for mobile cranes and mining equipment, and industrial conductor bars, used for example in factories, warehousing and ports.
The Group’s products are sold to a wide customer base throughout the world. Fandstan has global operating subsidiaries including facilities in UK, Germany, Netherlands, USA, Australia, Poland and China and has over 1,000 employees worldwide.
Members of the Fandstan group have completed a broad range of project across the transport industry and worked on ground breaking rail systems. Fandstan boasts the Melbourne tram system, the largest in the world, as one of its international customers and its Australian subsidiary continues to be involved in the maintenance and upgrading of this 250km network.
Other Group members such as Brecknell Willis designed, supplied and installed the third rail and collectors for the London DLR, a 34km railway with 40 stations and more than 100 trains, and Stemmann Technik’s apparatus was installed on the Siemens train, which set the locomotive world speed record of 357km per hour.
For the year ended 31 December 2012 Fandstan reported sales of circa £140m and operating profits before tax, depreciation and amortisation of circa £13m. The parties have exchanged contracts and expect the transaction to be completed in the first quarter of 2014, subject to customary closing conditions and competition authority clearance.
James Ellis, Head of Industrials at Cavendish, commented:
“The sale of Fandstan has been one of the most complex we have executed with 19 separate legal entities on 4 continents. The smooth conclusion of the sale shows the importance of bringing well-capitalised overseas strategic purchasers such as Wabtec to the table through a controlled process. This has been the exit route for more than half of the 450 plus businesses Cavendish has been involved in over the past 25 years.”
Michael Bostelmann, Group Managing Director, said:
“This has been a highly complex transaction involving 10 jurisdictions. Cavendish has held our hands throughout the process, providing a dedicated team who have done a superb job; this has greatly reduced interruptions to our businesses whilst adhering to the original timetable. Cavendish has achieved a very successful sale at a fair price to a buyer who will enjoy significant strategic value from the purchase.
“The Cavendish Team, led by Alistair and Mike, did a fantastic job managing the process, providing valuable advice and identifying Arbuthnot as the right partner for the business. It was a pleasure working together and we are pleased to have achieved a brilliant outcome for the company.”
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This has been a highly complex transaction involving 10 jurisdictions. Cavendish has held our hands throughout the process, providing a dedicated team who have done a superb job; this has greatly reduced interruptions to our businesses whilst adhering to the original timetable. Cavendish has achieved a very successful sale at a fair price to a buyer who will enjoy significant strategic value from the purchase.
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