Bath-based Rotork, the market leading actuator manufacturer and flow control company, announced today that it has paid $75.8m (£48.1m) in cash for Fairchild, a US manufacturer of high-precision pneumatic controls and power transmission products for a wide range of industries.
The American company, headquartered in Winston-Salem, North Carolina, is described as asset-light with a similar outsourced model to Rotork. In its last audited accounts to December 31, 2010, Fairchild reported revenue of $21.1m and profit before interest and amortisation of $6.3m. Gross assets at the same date were $42m, which included $36m of goodwill and intangible assets that will be reviewed as part of the fair value accounting for the acquisition. In the 10 months to October 31, Fairchild achieved EBITA of $6.7m on revenue of $20.8m.
Fairchild manufactures a full range of market leading regulators, boosters, relays and transducers. These are used in a wide variety of applications that require precision control of pneumatic devices and motion control equipment. As well as oil and gas applications, the company also benefits from orders in pharmaceutical and biomedical equipment, tyre manufacturing machinery, robotics, food processing and chemical manufacturing applications. The company, whose management will stay in place, has offices in China and India with local presence in Mexico, Russia and Brazil. North America remains the largest market with 57% of revenue with Europe accounting for 16% and North Asia 12%.
Rotork group chief executive Peter France said: "The acquisition will strengthen our presence in the global flow control market and broaden the scope of the group's activities whilst remaining close to our core competencies."
Meanwhile an interim management statement shows that Rotork's third quarter order intake remained strong, up 6.5%. Orders for the first three quarters are 14.7% ahead of the same time last year.
Third quarter revenue was a record with year-on-year cumulative earnings to October 30 some 13.4% ahead. Mr France is looking for a stronger fourth quarter as further projects are delivered out of an order book valued at £163.8m, 8.3% higher than the same point last year.
He added: "We anticipate a strong end to the year to deliver full year revenue and profit in line with the guidance given at the falf year results."
The shares were down 1.98% or 33p at 1,636p while the FTSE 100 was down around 1% early this afternoon.
