Member Article

Cramlington's Advanced Electronics sold in deal worth potential £24 million

The Cramlington-based manufacturer of fire protection and warning systems, Advanced Electronics, has been sold to global safety products outfit Halma plc, in a deal potentially worth £24 million.

Advanced’s owners, Connection Capital, sold the firm for an initial cash consideration of £14.1 million, with potential for a further consideration of £10.1 million, dependent on earnings growth targets to March 2015.

The acquisition was funded from Halma’s cash and debt facilities and Advanced will now operate as a stand-alone business - retaining its management team.

Connection Capital originally invested in Advanced in 2013 - supporting the business’ international expansion into over 60 countries.

With 125 staff and offices in the US, Dubai and India, the firm is now recognised as a world-leader in supply of fire systems, including alarm control panels and extinguishing control panels.

Advanced Electronics was advised by Paul Mankin, head of the PwC Corporate Finance team in Newcastle, Duncan Reid, head of the Watson Burton Corporate Law team and Dean Harris, KPMG Tax, whilst EMW provided legal advice to Connection Capital and other minority shareholders.

Bernard Dale, partner at Connection Capital, said: “We backed an experienced team and as a result of their hard work and world class products derived from its in house R&D, the company has grown significantly since the investment was made in 2003 from a business of 25 people in 2 UK offices into a global, market leader in this sector.

“We believe that the sale to UK based Halma is the right exit route for both the management team and investors.”

Ray Hope, MD for Advanced Electronics added: “We’re delighted to be signing the deal with Halma, it’s the perfect partnership to help us step up to the next level and hit some big international milestones.

“Halma’s ethos is similar to Connection’s. It invests in exciting, successful businesses and supports the existing team to continue growth and development. It’s good news for all our customers, partners, investors and employees and we are more excited than ever for the future of Advanced.

“PwC and Watson Burton have provided a first class service to Advanced, and through their hard work, dedication and professionalism, helped to ensure this deal got over the line.”

Andrew Williams, CEO for Halma added: “Advanced complements Halma’s existing Fire business and reinforces our focus on growth in international markets, where fire system product approval regimes are becoming increasingly more challenging to navigate successfully.”

Paul Mankin, PwC, said: “We are delighted to have advised the Advanced shareholders on this transaction. Although our global network identified potential partners from around the world, it is particularly pleasing that a UK Company was able to demonstrate that it will be a great owner for Advanced going forward.”

Duncan Reid, Watson Burton commented: “This deal marks the beginning of an exciting new chapter for Advanced. Not only will the new partnership with Halma offer increased opportunities for growth, it will also help raise the profile of the North East as a place to do business on an international level.

“We are very pleased to have advised Ray and the management team on this transaction and look forward to watching Advanced grow.”

This was posted in Bdaily's Members' News section by Tom Keighley .